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Jon Excell
Editor
Cameron’s veto could make life doubly hard for UK manufacturers
It’s not yet certain what repercussions David Cameron’s European walk-out will have, but it’s becoming increasingly clear that beyond the euro-sceptics within his own party and elements of the right-wing press, not many people seem to think it was a very good idea.
Defending his position in the Commons earlier this week, Cameron argued that treaty change without safeguards for the UK’s financial services sector would not protect Britain and claimed that his decision will not be bad for business.
But as many commentators and politicians have pointed out since not only has he not achieved any safeguards, but UK interests could be damaged by losing its place at the top European table.
Nick Clegg - notable by his absence at Monday’s commons debate - has described the decision as “bad for Britain”, whilst Ed Miliband dubbed it a “diplomatic disaster” that will put the UK on the sidelines for years. Others have accused the PM of recklessly throwing away UK international influence to protect from regulation an industry which is in fact in urgent need of regulation.
There are also concerns over the impact of the decision on the government’s plans to rebalance the economy in favour of engineering and manufacturing.
UK manufacturing is heavily reliant on both inward investment and demand from the EU (which accounts for around half of all UK exports). Anything which affects the day to day practicalities of dealing with European partners, or stokes up anti-British feeling in Europe could have dire implications for industry.
What’s more, the UK has long been seen as a route into Europe by the US, China and others. Despite Cameron’s protestations that its both desirable and possible for the UK to remain a full committed and influential member of the EU, a perception that the UK’s European influence is waning could seriously dent the appetite of foreign firms for investing in the UK.
So far, the response from industry has been fairly muted. Both The EEF and the CBI, usually vocal on any issues affecting manufacturing, have remained relatively quiet. They are, they say, monitoring the situation. And it’s clearly too early to do much more than argue over the possible implications.
But the warnings that the UK could find itself isolated in Europe’s slow lane are growing and the government now faces an uphill struggle to assure foreign investors that we’ll remain at the heart of international decision making.
Meanwhile, UK industry, a rare glimmer of hope in our cash-strapped economy will have to work doubly hard to sell its expertise to the rest of the world.
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Readers' comments (48)
Anonymous | 13 Dec 2011 4:07 pm
We have to safeguard manufacturing, jobs and our financial sectors. Falling into the 'quicksand' of eurozone would just place us in the same potential position as Italy, Spain and Greece.
Switzerland manages very well dealing with others without being in the EU so whay can't we - keep open trade borders but nothing else. I hate to admit in this instance Cameron was right to stand up to the bullies from the EU.
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paul davies | 13 Dec 2011 5:07 pm
not many people think its a good idea...really ? look at your poll results !
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Editor's comments | 13 Dec 2011 5:07 pm
Anonymous | 13 Dec 2011 5:11 pm
This has been made far more political and divisive than it ever should have been. The problem is with the Eurozone and the new rules proposed should not have required anything like a new EU wide treaty or amendment. Sooner or later I fear we would have had to veto anyway, because it would have meant signing up to detrimental measures (including the right to regulate more if we so desire which I believe would have been taken away!) If the result is some anti British sentiment and the possibility that our manufacturing may suffer then surely the long term lesson is that we should not be so reliant on inward investment and trade with the EU. (By that I mean our market should be the whole world and not just 'mainly' the EU).
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BasilKnight | 13 Dec 2011 5:45 pm
Its so obvious that Germany wants to govern the whole of Europe and this latest requirement from the combined Germany and France is the prerequisite move towards the New World Order that Gordon Brown spoke about on many occasions.
David Cameron may be "putting England first" but in reality the banks are an entity unto themselves, who look after themselves first and very reluctantly loan money to us Engineering businesses as they make more money betting against eachother in their own little world.
Maybe a few more contracts should be awarded to English companies and not sent off to Germany or France all the time. Are their businesses getting EU subsidies we don't know about??
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Anonymous | 13 Dec 2011 6:29 pm
Why do some people seem to think Britain is such a special case that it would be better off outside the EU? I don't see any other countries wanting to leave. If it's 26:1 I suggest we should re-think the position and try to reach a deal. This is damaging our international standing and making the entire image of Britain look self-centred, ignorant, and reactionary.
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Bob Short | 13 Dec 2011 6:35 pm
The euro is going to go and it's just a matter of time. This meeting was just a smoke screen to keep the markets happy and will do nothing to keep the euro long term. The UK is a very large market 60 millon people in a very small space and EU exports into the UK is something that the EU would not want to upset, also the UK is the 3rd largest contributer into the EU. The UK needs to get back to what the the EU should be " The common Market" nothing more.
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Anonymous | 13 Dec 2011 9:03 pm
This is a case of what price for true democracy. The EU is not a democratic institution and personally I believe it is a small price (if any) to pay for retaining our British values.
We are led to believe that union is necessary to have a larger say in world matters, but if this was so it would not be the electorates voice that would be heard as the electorates wishes have been ignored by the arrogant pompous megalomaniacs for the last 40 years.
Common Market yes, European Union definetely not. Ideally it would be a World Common Market.
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Anonymous | 14 Dec 2011 11:39 am
If anyone thinks the European Union is or ever was a free market, they must have been in a 40 year coma. The sooner we leave behind their attempt to make a new Soviet State of Europe, the better. We had two world wars to stop Germany dominating Europe; are those 70 million lives to be shown to be lost in vain ?
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paul | 14 Dec 2011 11:40 am
How exactly is this going to affect UK manufacturing? In my industry German companies buy from German companies, Italian from Italians and so on - so nothing is going to change as a result of this incident.
The EU as a combined bunch of countries will take years to recover and will unlikley match the demand for engineering services of the emerging markets in a lifetime so UK businesses should go where the money is and focus less on the EU.
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Denis Battrum | 14 Dec 2011 11:52 am
The PM's move will the best thing that has happened to Britain in a generation.
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