HONG KONG (Reuters) - Britain’s large financial services industry risks losing out if the country leaves the European Union and supporters of a “Brexit” are wrong to suggest it would mean business as usual, Europe’s top official for the sector said on Friday.
Prime Minister David Cameron is trying to negotiate changes in the terms of Britain’s EU membership which he then plans to put to voters in an in-out referendum by the end of 2017.
The European Commissioner for Financial Services, Jonathan Hill, who is British and a former adviser to Cameron, said the City of London would suffer a loss of influence over the EU’s single market in the event of a ‘Brexit’.
“I am very struck by the number of financial services companies who come to me and say the single market in Europe is extremely important for their business and they would like to remain a part of that,” Hill said during a visit to Hong Kong.
“There are some people who say that Britain could leave the EU and would still be able to have access to the single market on the same terms, or sometimes they say on better terms, than they currently have. I don’t believe that is true and people need to understand that.”
At the same time, Britain would probably still have to contribute to the EU’s budget to have some kind of access to the single market, he told reporters on the sidelines of a conference.
“Also, if you are a part of something and you leave something and that breakup is protracted, difficult and acrimonious, you normally do not get better terms from the person you just left. It’s not how life works.” Hill said.
Earlier this week, Cameron formally told Brussels of his priorities for overhauling those ties. He has said he wants Britain to stay within a reformed EU.
Campaigners who want Britain to leave say the country would be better placed to strike its own trade deals if it were not part of the 28-nation bloc. However, the top U.S. trade official has said Washington is not interested in forging free trade deals with individual countries.
Britain accounts for nearly a quarter of the EU’s financial services industry and about eight percent of national income is generated by banks, brokerages, investment firms and other financial companies.
Reporting by Lisa Jucca in Hong Kong, writing by William Schomberg in London; Editing by Gareth Jones