Goldman Sachs is warning that a UK exit from the EU would “severely compromise” its ability to sell financial services across the continent.
The Telegraph reports that Goldman Sachs economic analyst Kevin Daly said an exit would amount to a “loss/loss scenario” for both the UK and the EU.
Prime minister David Cameron is backing a draft bill that pledges to hold an in/out referendum on EU membership in 2017. It is a private members bill backed by Tory MP James Wharton and currently only has the support of the Conservatives so is unlikely to pass.
Goldman Sachs says there would be a “significant economic cost” to the UK if it left the EU as the bloc makes up 16 per cent of UK gross domestic product.
Daly says: “Given the size and importance of the UK economy, it is unlikely that the UK could negotiate the same access to the EU single market that Switzerland and Norway have achieved.
“In particular, the UK’s ability to conduct business in financial services across the EU is likely to be severely compromised by a departure from the EU.
“We believe that a UK exit from the EU would represent a ’loss/loss’ scenario for both the UK and the EU. However, it is likely that the loss would be greater for the UK than for the EU.”
Despite its warnings, Goldman Sachs says it “doesn’t appear likely” a referendum will take place because the Conservatives need to win an outright majority in the 2015 election.