WTO chief warns Britain over risks of leaving EU

China says EU membership UK’s choice; Eurotunnel boss sees no Brexit impact

LONDON, May 26, (Agencies): Britain would face gruelling negotiations to set the terms of its World Trade Organization membership if it decided to leave the European Union, the group’s chief warned in Thursday’s Financial Times.

WTO director-general Roberto Azevedo doubted claims made by supporters of a so-called Brexit that Britain would be able to access the European market through the WTO if it were unable to secure favourable alternative deals on leaving the EU.

“Pretty much all of the UK’s (global) trade would somehow have to be negotiated,” he told the business newspaper, adding Britain would not be allowed to “cut and paste” a new deal.

The warning follows similar interventions by the British Treasury, the Bank of England, the International Monetary Fund and US President Barack Obama, who have all raised the spectre of negative economic consequences of a Brexit.

Polls currently show the “Remain” camp in the lead ahead of the June 23 inout referendum.

Britain’s current WTO membership is under the agency of the EU.

Meanwhile, Britain must decide for itself whether it stays in the European Union, but China hopes to see a strong Europe that contributes to the global economy, Chinese Foreign Minister Wang Yi said on Thursday ahead of Britain’s June 23 EU membership referendum.

Beijing has long been worried about the implications of free trade-supporting Britain leaving the bloc and of any weakening of a grouping which it views as a vital counterbalance to the United States, diplomats say.

China has also made little secret of its happiness with Britain’s support to push an eventual China-EU free trade deal.

Wang told a news conference about China’s hosting of the Group of 20 nations this year that China did not interfere in other countries’ internal affairs.

“Britain’s direction is to be decided by the people of Britain. We, of course, will respect the decision made by the British people,” he said.

But China would like to see Europe’s integration process further develop, Wang added.

“We hope the EU can further strengthen coordination and create an EU that is stronger, stable and makes contributions to world peace and development,” he said.

During a visit to Britain in October, Chinese President Xi Jinping told Prime Minister David Cameron he wanted to see a united European Union.

It was a rare albeit indirect mention of another country’s planned vote by China, which regularly says its does not interfere in the internal affairs of other nations.

In a separate report, the boss of Eurotunnel said on Thursday that Britain leaving the European Union would have little impact on the under-the-English-Channel business, dismissing as a joke his prediction last year about getting a boost from new duty-free shopping.

Chief Executive Jacques Gounon also told Reuters in an interview that he was expecting higher second-quarter sales for Eurotunnel — which runs under the water between England and France — because of the Euro 2016 soccer tournament in France and thriving freight trucks traffic.

“I do not see a visible and identifiable impact on Eurotunnel’s business from a British exit”, Gounon said, referring to Britain’s June 23 referendum on EU membership.

“We are a vital economic artery between Britain and the Continent, with very high customer loyalty ... Eurotunnel benefits from a permanent and continuous traffic flow that has economic justifications and for which we do not expect disruption in the medium-to-long term.”

Last November, Gounon told the Financial Times newspaper the tunnel could get an “incredible boost” from Britain leaving, predicting the return of duty free shopping traffic under which Britons used to make the trip in order to load up on tariff-free drinks and cigarettes. Crossborder duty exemptions within the EU were abolished in 1999.

“That lighthearted comment was made many months ago and the arguments have moved on a long way since then; overall we believe that the impact for Eurotunnel would be neutral, whatever the result of the referendum,” Gounon told Reuters.

Even a sharp drop in the value of the pound would not change anything, he said.

“In 22 years of operation, there has been no clear correlation between the Pound level and the fact that our markets are growing 2-3 percent a year.”