NEWS

John Longworth of the BCC said it is not surprising that businesses want to see more free trade, but less integration across Europe.

BCC: Majority of exporters favour free trade area, but integration less loved

Business leaders in Britain are keen to trade with Europe but are concerned about the European Union’s level of integration.

The views are from a survey of over 7,500 companies conducted by the British Chambers of Commerce.

It asked them about which type of trading relationship with other countries in Europe would most benefit their business in the long-term.

When asked what kind of trading relationship they would like with Europe, over half of businesses surveyed expressed no opinion. Of those that did, more than half (51%) of exporters favour a ‘free trade area’, versus less than a third (31%) who support the concept of an ‘economic union’.

More than half (55%) of all respondents are unsure about which trading relationship with Europe would benefit their business. When broken down, this amounts to a third (33%) of exporters, and a huge two thirds (66%) of non-exporters.

Support for UK entry into a monetary union in the eurozone was at just 3.9% of all business respondents, showing the impact of the ongoing euro crisis on UK business attitudes toward the concept of a single currency.

Meanwhile, just 4.4% of all respondents favoured leaving the EU altogether and agreeing bi-lateral trade agreements with individual European countries.

When it came to increasing sales in global export markets, some reported that it was easier to trade with a range of non-EU countries (e.g. 9% reported regulatory barriers for EEA countries versus 12% of businesses reporting similar barriers in the EU), suggesting that the single market has yet to deliver the growth Europe so desperately needs.

Commenting on the findings, John Longworth, director general of the British Chambers of Commerce (BCC), said: "It is not surprising that businesses want to see more free trade, but less integration across Europe. Companies tell us that the burden of European regulation and legislation is in danger of making them less competitive in the global market."

"Our results show that politicians must not be entranced by the siren songs of either the pro- or anti-European camps. Less than one in every 20 companies responding to our survey holds either extremely positive or extremely negative views about Britain’s relationship with Europe. It is also staggering to see just how many businesspeople are unsure or unaware of whether links to the rest of Europe benefit them."

"Companies in the real economy want the UK government’s European agenda to be practical and pragmatic. They also need better information about what Europe means for them. So ministers must push hard to remove barriers to free trade among European countries, and make the single market a reality for all businesses.

"For example, the single market for services, where the UK is the second-biggest exporter in the world, hasn’t even really got started. Companies we surveyed indicated that they found it as easy to increase their trade with some non-EU countries, as it was to increase their trade with other EU countries. Since the single market is the only real source of sustainable growth for the EU, leaders must focus on how to make it work better.

"At the same time, our representatives in Brussels must continue to fight all proposals that would slap additional costs or regulatory burdens on British businesses."