Foreign investment in West Midlands manufacturing could dry up if Britain votes to leave the European Union , Foreign Secretary Philip Hammond has warned.
He said the car industry, which employs thousands, would be particularly hurt by a decision to quit the EU.
Indian-owned Jaguar Land Rover has announced investment of billions of pounds in the West Midlands, including £1.5 billion in its Solihull factory over the past five years as well as investment at sites in Birmingham, Coventry and its engine plant near Wolverhampton.
Mr Hammond spoke to the Birmingham Post as the battle for Britain’s future got firmly under way following Prime Minister David Cameron’s announcement that a referendum on EU membership would be held on June 23.
The Foreign Secretary also said:
* The remaining EU countries will punish Britain if it quits by forcing us to pay a high price for access to EU markets
* The UK could be forced to open its borders to the EU’s 500 million citizens even if it leaves
* A decision to quit the EU would be permanent – but if the country chooses to stay, it could change its mind 20 or 30 years later
Mr Hammond said foreign firms wanted to invest in the UK because it was an English-speaking nation with a commitment to free trade and a legal system they trusted – and which gave them access to the EU market of 28 countries and 500 million people.
He said: “I think people both in the West Midlands and the North East regions in particular will recognise the benefits that Britain has been able to enjoy as a very attractive, some would say preferred, location for inward manufacturing investment to service the European Union markets.
“The car industry in particular has benefited from the combination of Britain’s very strong industrial heritage, very attractive environment for foreign manufacturers to come and set up plants and invest and create jobs, while at the same time being able to offer a domestic market of 500 million people.
“The car industry – and the people who work in the car industry are not of course just the car manufacturers but the huge supply chain – will recognise very well that the kind of volume of cars they are producing would never be sustainable on the back of the British market alone.”
EU membership allowed firms to export cars made in the UK without paying tariffs, but it also made sure their interests were represented when EU rules and regulations were drawn up, he said.
Mr Hammond said: “It’s by being part of that process that we protect British workers and British jobs in the West Midlands and the North East.”
He added: “I know from my travels around the world that it is Britain’s role as an English-speaking... country that is inside the European Union that makes it so attractive as a destination for inward investment.
“It is a business-friendly climate which brings with it access to this huge market of 500 million. And we would be putting a huge amount of economic security at risk if we were to leave the European Union .”
Campaigners who want the UK to leave the European Union say we would be able to negotiate a new trade agreement with the EU after we left. But Mr Hammond said other EU countries would be “deeply hurt” if the UK quit – and could make us pay a heavy price in return for an agreement.
“If we vote to leave the European Union we will have to negotiate with the remaining 27 countries what kind of terms of access they would prepared to give us to the single market and what price they will extract from us for that access.
“I don’t believe the other 27 countries of the European Union will be driven in that negotiation by a desire to see Britain as successful and as prosperous as possible outside the European Union. Far from it. Many of them will be deeply hurt, deeply injured that we have left the EU.
“They will believe that our actions have threatened the EU and possibly threatened their own political arguments in their own home countries, where they too will have eurosceptics.
“I don’t think they will be looking to do us any favours or to cut any sweet deals with Britain. They will be looking to drive a very hard bargain with us for whatever access we are able to secure to the single market.”
If the UK does choose to remain in the UK in the June 23 referendum, it could still change its mind in the future, the Foreign Secretary said.
“Nothing says we can’t ask ourselves this question again in the future, in 20 or 30 years’ time, if we find Europe is not heading in the direction we want it to.
“Leaving the European Union would be final and irreversible. If we found outside that life is colder and more inhospitable than some people imagined, it would be too late to do anything about it.”
The UK would not regain control of its borders if it left the EU, Mr Hammond said.
Rather, it would need to continue to allow entry to EU citizens as a condition of a trade deal, he argued.
“Unless we were prepared to cut ourselves off altogether from the single market we would not be able to regain control of our borders, we would not be able to regain control of our migration policy.
“Every country which has a single market agreement with the EU has had to accept not only that they contribute to the EU budget just as they would if they were member states but that they have to have free movement of labour between their country and the EU countries .
“Switzerland, Norway, Iceland all have to face those burdens. It’s the price they pay for access to the single market.
“I don’t believe British business will be able to prosper without being able to access the single market. 47 per cent of our exports go to Europe.”
STAY OR GO? MIDLAND MPs STATE THEIR CASE
➤ REMAIN IN EU
* Steve McCabe (Lab Selly Oak): “There are plenty of things about the EU I don’t like but on balance it comes down to jobs. I am persuaded to stay in on that basis.”
* Jess Phillips (Lab Yardley): “I think being in the EU gives us more influence in the world. “It would be a backward step to be more isolationist. “I have seen the desolation of industry in Birmingham in my lifetime and now we are seeing it come back. Leaving the EU now would put that at risk.”
* Richard Burden (Lab Northfield) said, in a statement on his Facebook page: “Stronger in for jobs, for protecting the future of the planet, for trade and for our place in the world.”
* Liam Byrne (Lab Hodge Hill) said on Twitter: “Today’s world is not a place to be on your own. We’re ‘Stronger In’.”
* Shabana Mahmood (Lab Ladywood) said she was backing the “stay” campaign.
* Jack Dromey (Lab Erdington) is also supporting the “stay” campaign. He said: “Isolated from the European Union, Birmingham and Britain would be weaker and less safe.”
* Julian Knight (Con Solihull) announced he would be supporting the stay campaign – after consulting with residents and agonising with himself. He said on Twitter: “Hardest decision I have had to make but with Solihull a key exporter to EU I have chosen head over heart.”
* Caroline Spelman (Con Meriden) is a pro-EU Conservative and was one of the founders in 2013 of a group of Tory MPs backing reform of the EU and promoting the benefits of EU membership. She said on Twitter: “How long would it take to renegotiate trade with all EU member states? No one can safely say. Businesses are better off in a reformed EU.”
* Margot James (Con Stourbridge) is another enthusiastic supporter of EU membership. In an article published on her website, she said: “When the referendum comes I will be voting to remain in the EU. Britain is better off in Europe. “Britain is safer in Europe. And in Europe, Britain has greater global influence.”
* Sajid Javid (Con Bromsgrove) is supporting EU membership.
* James Morris (Con Halesowen & Rowley Regis) said: “After considerable thought I have decided to support Britain remaining a member of a reformed European Union. “The EU is far from perfect, and there is still much that can be done in reforming our relationship and ensuring that the EU remains competitive in an ever changing world. But on balance I believe that if we want to protect jobs and growth here in Halesowen & Rowley Regis, and the wider Black Country, our interests are best served as a member of the EU.”
* David Winnick (Lab Walsall North) said : “Now that the referendum has been agreed for June 23, my view is that we should stay in. “When it comes to trade, investment and the rest it would be particularly damaging to the West Midlands for us to isolate ourselves.”
* Ian Austin (Lab Dudley North) said he was supporting the campaign to “stay” in the European Union.
* Adrian Bailey (Lab West Bromwich West) said: “I am firmly in favour of staying in”.
* Tom Watson (Lab West Bromwich East) said on Twitter: “To me, being European and in the EU is part of our national fabric. “It’s actually part of what it means to be British. I can’t opt out of that.”
➤ LEAVE EU
* Roger Godsiff (Lab Birmingham Hall Green) is a member of “Labour Leave”, a campaign group of Labour MPs opposed to EU membership.
* Gisela Stuart (Lab Birmingham Edgbaston) said last week: “I am being asked to exercise my once in a generation chance to either endorse a relationship and an institution that shows a deep inability to reform or to say this won’t do – we can do better. “I will vote Leave.”
* Mike Wood (Dudley South Con) , who previously worked at the European Union in Brussels and Strasbourg, said he was not impressed by the changes EU countries had agreed to make. He said: “When our EU partners were so uninterested in serious reform at a time when we are considering whether Britain stays in the EU, I do not believe that there is any real chance of them confronting the need for those reforms at a later date if Britain commits its future to remaining a member.”
* Andrew Mitchell (Con Sutton Coldfield) said he had yet to declare which way he would vote. He was listening to the views of constituents, particularly young people, he said. Mr Mitchell has also promised to organise a debate with leading protagonists on both sides for constituents to listen to and take part in.
* Khalid Mahmood (Lab Perry Barr) had previously backed the campaign to leave the EU but said he was reassured by Prime Minister David Cameron’s “deal” with other EU members and was now considering which way to vote in the referendum.
John Spellar (Lab Warley) said he had not declared which way he was voting.
Wendy Morton (Aldridge-Brownhills Con) said she had not yet decided how to vote.