Jan 21 Britain should build closer ties with the
European Union and devote more resources to Brussels to
influence financial market reform and benefit the economy, the
country's leading banks said.
The British Bankers' Association (BBA) weighed into the
debate over Britain's role in Europe on Wednesday, adding its
voice to those of other businesses that favour Britain
continuing its membership of the 28-member trading bloc.
Prime Minister David Cameron has promised voters he would
renegotiate the terms of Britain's EU membership before holding
an in-out referendum by 2017 if his ruling Conservatives win
elections due next year. Finance minister George Osborne
recently warned the EU it must reform if it wants Britain to
remain a member.
"Given the significance of financial services to the UK and
the degree to which legislation is set at an EU level, there is
an overwhelming case for the UK to devote further resource and
expertise in engaging in the European process to increase the
level of influence in priority areas," the BBA said in a
submission to a UK Treasury review into the division of powers
between London and Brussels.
The BBA said membership of the EU enhanced Britain's ability
to influence international negotiations.
But the European Commission needed to ensure plans for a
euro zone banking union did not mean the euro area became "a
market within a market," the BBA warned.
It said the single EU market was a significant factor in
London's success as Europe's financial hub and therefore of
considerable value to the economy.
U.S. bank Citigroup, which has a big presence in
London, also warned against Britain opting out of the EU and
said such a move could hurt the economy and reduce investment
from international companies.
Jim Cowles, Citi chief executive officer for Europe, Middle
East and Africa, told the Financial Times there was "mounting
concern" among clients about their ability to use Britain as a
regional hub if the country exits the EU.
"It is not that international companies will stop investing
in Britain, but their investment just will not be at the scale
we have become accustomed to," Cowles told the newspaper. Citi
confirmed the comments were accurate.
European aerospace group Airbus, one of Britain's
largest employers, on Tuesday voiced concerns over the
possibility of the country leaving the EU, saying the benefits
of an alternative economic model needed to be proven.
The London-based Centre for European Reform (CER) predicted
last week that Britain would struggle to maintain trade with
other EU member states - now 54 percent of goods trade - if it
left the bloc.