Vince Cable: European single market represents a British vision of an open Europe

Britain has attracted the world’s top companies to invest here, creating jobs, on the basis of access to the European single market. That’s what Vince Cable told an audience in Bristol earlier this week. Far from being an invention of straight-banana obsessed bureaucrats, the EU represents a British vision of an open Europe, he added. Here is his speech in full.

It is great to be here in Bristol celebrating the best in British manufacturing with the leaders of our top manufacturing companies.

Manufacturing still provides half of our exports, three quarters of scientific innovation and two and a half million relatively well paid jobs in the UK.

There is a big cloud on the horizon: the dangerous void if the UK decides to exit the EU.

Today we have powerful testimony from the respected and independent research body; the Centre of Economic and Business Research. They remind us that the manufacturing sector depends heavily on the EU Single Market and that 950,000 of those jobs are linked to EU trade directly or through the supply chain.

Leaving the EU puts many of those jobs at risk.  Some of the leading Brexit campaigners admit frankly that the loss of manufacturing is part of what they call ‘the price worth paying’.  One of the few leading UK economists to depart from the overwhelming professional consensus in favour of Remain is Professor Minford who says that ‘if we left the EU it seems likely that we would mostly eliminate manufacturing”.

And looking forward, I see that the CEBR believe 100,000 new jobs could be created in the sector. But not if we leave and you’ll hear shortly from leading industrialists why they believe leaving would have a negative impact on investment and job creation in UK manufacturing.

My own views were heavily influenced by having served for five years in Cabinet, responsible for business, trade and industry. The crux of my argument is the Single Market.  It was negotiated in the 1980s by a British government.  The Single Market was not invented by Brussels bureaucrats, let alone Hitler and Napoleon.   It represented a British vision of an Open Europe: free trade in goods and services, free movement of capital, free movement of labour.  Not just clearing away tariffs but establishing common, recognised standards.

The juvenile caricatures flowing from the pens of Nigel Farage, Boris Johnson and others – the straight bananas, square strawberries and smaller condoms – aren’t just silly and fabricated; they miss the essential point that the Single Market reduces administrative barriers to trade.  Any manufacturer knows that it is costly and inefficient to reproduce 28 versions of the same widget.

I saw the process of integration at work as Secretary of State.  When I talked to Siemens about their new investment making turbines for offshore wind in Hull they saw themselves as a European company operating within the Single Market.

 When I talked to car companies about where they would build their next model- Nissan, General motors/Vauxhall, BMW/Mini, JLR or Ford making engines-a critical concern was their ability to be able to trade freely within the Single Market on common technical standards.

Our thriving aerospace industry, which is hosting us today –at GKN, a key Tier 1 supplier- relies heavily on European supply chains, and the Single Market. Airbus, a key part of the sector, is a European collaboration and I would fear for the UK’s civil aviation manufacture if the UK left.

One of Britain’s real achievements has been to attract the world’s best companies to produce here on the back of access to the Single Market.  The Brexiteers want to break that link: divorce.  Divorce can work out but usually it is messy, nasty and costly. The same here

Now you might say:  what about small business?  But many small companies are in the supply chains of big companies.  Bristol is a booming city because of the many small companies which supply big companies like this one.

You might respond that “ trade in cars and aerospace is all well and good, but our economy is 80% services”.   The are however very porous boundaries between manufacturing and services.  Crucial to the success of manufacturing is good software, design, advertising and other creative industries.

The EU helps these industries by eliminating non-tariff barriers. So it means an engineer or an architect can get off the plane in Munich or Madrid

The next stage of development of the Single Market aims to bring down the remaining barriers to trade in services, energy and digital.

We are sometimes told by the Brexiteers that if we left the EU we could have a bonfire of EU red tape. But there isn’t much left to burn.  The evidence suggests that Britain has some of the least regulated product and labour markets in the world.  And, of course, some regulation is essential to protect the environment, to protect consumers and to protect workers.

And if we left but wanted to sell into the Single Market, we would be forced to abide by the rules of the Single Market while having no say over those rules. There is no future standing on the side-lines looking in – we need to be in the room when they’re discussed – fighting for British interests and shaping the rules.

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  • Spot on Vince. Anyone who ignores the clear advantages of the single market and pretends that somehow we can have the benefits without the costs is living in a fantasy world.

  • The idea that the 5th largest economy in the world can’t negotiate a deal to gain that access on our own terms (esp when they have a trading deficit with the EU) either means that we have a crap government or tells me all I need to know about the current idiocy of the Lib Dems. They are slowly divorcing themselves from mainstream opinion that believes we should demand the best deal from the EU in or out.

  • Nonconformistradical 4th Jun '16 - 10:34am

    Just because the UK has the 5th largest economy by country in the world doesn’t say much. Looking at GDP in relation to population – the UK appears to be underprforming relative to the US. The UK also lags on productivity – way behind other leading coutrnies – both EU and non-EU.

    So if the rest of the EU won’t grant access on ‘our own terms’ as you put it – what are you going to do? Send in the gunboats? We don’t do that any more!

  • Paul Holmes 4th Jun '16 - 11:11am

    Jane: The idea that, if we leave, the remaining 27 EU countries would grant us a better trade deal than they give themselves is pure fantasy.

    As a big a fantasy as the idea that people like Farage, Gove and Johnson have suddenly converted to the idea of pumping tax payers money into industries like Steel or into the NHS -even if the Brexiteers ‘Magic Money Tree’ really existed.

  • The problem with the single market argument – and it should bother Liberals more than it does – is that it is used to produce an overwhelming set of rules that are of dubious necessity. Do we actually need rules about the number of bananas per bunch for example?

  • Nonconformistradical 4th Jun '16 - 11:54am

    “As a big a fantasy as the idea that people like Farage, Gove and Johnson have suddenly converted to the idea of pumping tax payers money into industries like Steel or into the NHS”

    Quite – isn’t it more likely they might have the pockets of the wealthy more in mind than the well-being of the services and industries we, the people, NEED?

  • “So if the rest of the EU won’t grant access on ‘our own terms’ as you put it – what are you going to do?”
    The very idea that Brussels will take some form of revenge is frankly risible, and Brussels know very well the backlash they would suffer if they tried it on. The oft used argument against revenge is ‘there will be no tariffs on BMW’s’, but here’s another one that the EU will need to focus on very carefully, before they start getting uppity.?
    Once we tear up the Common Fisheries Policy after Article 50 concludes, are those French and Spanish trawlers ready to pay the UK a seriously hefty annual license fee to fish in ‘OUR’ waters? Do you seriously think the EU will get stroppy and give the UK a poor trading deal, …. and in return the backlash of much reduced North Sea fishing rights and very, very expensive fish.?
    So is your post Brexit revenge still on the table, or are we ready yet, to calm down and take our UK~EU trade negotiations seriously?

  • Hywel 4th Jun ’16 – 11:42am…… Do we actually need rules about the number of bananas per bunch for example?….

    Probably not; which is there are NO rules about how many bananas can be sold in a bunch…If there were, then Waitrose,Tesco, Sainsbury’s, etc. would be guilty…

  • The thing is you do not actually need trade deals. Plenty of countries trade all over the world by complying to the standards of the countries they are trading with. We have no formal trade deals as such with China or Japan or Switzerland. We import from all over the world, we export all over the world.

  • @Expats – But there are – see Commission Implementing Regulation 1333/2011 has such provisions.

  • David Evershed 6th Jun '16 - 6:07pm

    Re EU Banana Regulations

    Regulation 1333/2011 Annex I Section V C says

    “The bananas must be presented in hands or clusters (parts of hands) of at least four fingers. Bananas may also be presented as single fingers.”

    So the regulations say you must not present bananas in clusters of two or three.

    There is also a regulation about their curvature – really!

  • I have just sent my postal vote back with a Remain vote. But there really should be a sensible debate about how the ideal of a single market ended with a committee of bureaucrats drawing up rules about the minimum length on bananas (and various other OTT measures).

    The Lib Dems made a “Freedom bill” scrapping unecessary laws a key part of the 2010 manifesto – why not something similar for the EU?

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