02/07/2016 Talking Business

The British finance minister has declared Britain is open for

business but as the shock waves of the referendum decision to exit the

European Union rippled through the markets, what will Brexit really

mean for the economy and companies doing business here and abroad, and

what will it mean for Europe? That is what we are discussing this week.

Welcome to talking business from London. It has been a bumpy marriage

but the stage is set for a potentially long and messy divorce.

43 years after joining the European Community, Britain's fought to leave

has cast a cloud of uncertainty over the political and economic

landscape. The Brexit decision and initially hit shearers and the

pound, following 331 year low the dollar. The UK has also been

stripped of its triple-A credit rating by Standard Poor's and

further reading could follow. The European Commission president warned

against delay, saying... The German Chancellor Angela Merkel

said the EU was strong enough to survive.

Meanwhile, British finance minister George Osborne insisted only the UK

could trigger the exit process, and...

So what type of relationship should the UK now be establishing? To

discuss Britain and Europe's future in the short and long-term, I am

joined by a Lord Digby Jones who has held some of the highest positions

in British business, and the UK Trade Investment Minister from

2007-8. He is described as a reluctant Brexiteer.

O'Grady, an active trade union and O'Grady, an active trade union and

all her life. The first woman to hold the post. She was firmly in the

Remain camp. And the director of the Frankfurt stock exchange who

top German companies a household top German companies a household

name. He is dividing his time between London and Berlin. He would

have liked the UK to remain in the EU. Digby Jones, let me start with

you, a reluctant Brexiteer. You're very much somebody acquainted with

UK business. What was that about what the EU represented to the UK

that you are uncomfortable with? This is a's century. It is about a

globalised world than the EU was marching valiantly towards 1970. It

was looking in words, an amalgam of unelected people in Brussels with

vested interests of big business and trade unions. I have been on the

inside and sat in these meetings and I would have loved to vote to stay

known I had no confidence that the known I had no confidence that the

European Union will deform sufficiently to give the 520 million

people living in peace the pensions and health care and welfare they

will need in 50 years' time. The only way to look after our

grandchildren in that world is to generate sufficient wealth to do so

and I have to say, the way to setup and conducts its business there

wasn't a career it would ever reform and that is why. Francis, during the

time Britain has been a member of the EU, it has the power to impose

regulations on British workers. Have they been broadly beneficial? We

very often hear them described as red tape but of course the EU has

provided a guarantee for rights that are crucial to working people,

either new or stronger rights. The EU is also critical for working

people in terms of jobs. It is about cheap trade and being the

destination for nearly half of our exports and that means jobs, and a

lot of people are very worried today about what the future holds. Germany

sees the UK is a very crucial trading partner, and counterbalance

within the UK, because it finds commonality in terms of economic

policy with the EU more than with France. Through, and it was a sad

day for us in Germany to see that Great Britain is going to leave us,

and sad not just from an economy point of view but also Great Britain

made the lot of important contributions and it will be

difficult to go ahead without that. Looking at the argument we heard

early, I think it is also noticeable, and I just listened to

you, that it was quite a self-centred statement, because we

know that Great Britain is very good, but we also have to take year

in Europe of the weak countries, but are not where we are, and the reason

is very selfish again, because we want to avoid going back to 1930

whatever. We want to make sure we work together and not against each

other. But is this what you were saying, that you want the UK

unshackled from Europe and its peculiarities? Not in the slightest

and frankly if you will start bringing people up that they believe

in an economy that makes Germany Richard and them poorer, that is not

egotistical. For Britain, maybe for Germany, but not for Britain. One of

my formative moments on this issue was when I was Trade Minister and I

can remember sitting in Brussels and saying, why are we putting no

tariffs on agricultural produce coming in from abroad yet we add

tariffs if we give them the value added to the fine sugar in Africa

and bring it in as a refined, so the value-added stays in the developing

nation. Why do you tariffs that? To protect markets and make money. If

you want to Read to be a beneficial thing in the world, the rich nations

such as us and Germany and very much France who are very protectionist,

you should stop using Brussels to protect markets and condemning

Africa for taking your development check and buying raw materials.

Let's educate them and get them skills and allow them to develop

wealth. All I got in return was I am not having farmers demonstrating.

This is an egotistical unselfish argument from the forming members of

the EU, not from Britain. Do you see the EU as having become too

introspective? Trade unions across Europe don't believe the union is

perfect. In what way was it not? At its heart there are some important

values and we have to learn in this world that we all depend on each

other. That if one country is doing well and another poorly, that is a

problem for all of us and we shared an interest in making sure that the

wealth we all create is sure severely. My concern is that we are

going to see workers losing out in terms of the wages, rights and jobs.

Our top priority, the decisions taken, the top priority is that

working people mustn't pay the price. And I completely agree with

engaging fully with our friends in engaging fully with our friends in

Europe any commonality of creating wealth and look at the automobile

industry in Britain. It is still a unionised and very successful

because the unions and the manufacturers work in harmony and

partnership. Do you accept that Europe has become... Perhaps has

gone down a protectionist path or all of Germany being a dominant

economy and every other economy having a dependence on that. Germany

is the biggest member state and we cannot change that and we need to

stand up to that responsibility. What do you mean you can't change

that? We are successful in our business and we are big country. We

work very well with unions. We now need to deal with that

responsibility. I think Germany should be part of the EU and not

isolated. That is why I am sad that with Great Britain starting this

process the is certainly the danger and others will look at this again

will be very hard because we need to will be very hard because we need to

make sure that nobody gets an appetite. No punishment,

protection. But this sounds like protection. But this sounds like

playing into the concern you had that it had its own momentum, the

EU, it was a political project, and it had ceased to add value to the

people what was supposed to serve? Absolutely right. So why was it not

possible to reform from within? Because the vested interests were

not willing to deform. 75% of the taxation and spending Europe goes on

agriculture. Take a 21-year-old in Greece or Spain today, probably

unemployed, taking a big bong from Brussels to work in a subsidised

industry called agriculture. Why don't we keep the money in southern

Europe to give these people skills so they are attracted to northern

Europe because of skills, the attractive to the rest of the world

and Asia, or even better they stay at home and attract inward

investment. But you are discussing the wrong level. The level you

should discuss is how come the British politicians and diplomats

didn't manage to get allies and get their point across? That is a

problem, because the UK has not sent their best people and to the EU.

They have not tried to change the EU hard enough. We would welcome more

support than many of your points. I want to come to France's sci-fi may.

Is it true that we are effect subsidising industries and not

promoting our best interests? Bit of Europe. I think it depends on the

industry. There is a great record of success and investing in apprentices

and adults too. We know there is a long and dirty tale of small

businesses who are not investing for the future and the trade union

movement across Europe has always argued that skills are legal

priority. It is clear that young people in Britain voted to the

maiden, the decision is clear and it is no going back, but we ought to

young people who are deeply worried about their future and rights, not

just people coming to Britain but people going from Britain to other

countries, the hopes in the future of ever getting a home or a decent

job let alone a good wage. We bought to them to make the priority now is

across Europe that this generation who are disaffected and fuel they

don't have future, we start looking at any quality in Europe. It can't

go on. You are watching Talking go on. You are watching Talking

Business. We are discussing life after Brexit. What will Britain's

decision to leave the European Union mean for economy and business and

what sort of relationship will we now have with Europe in the future?

Lets start on this issue of EU funding and the UK has been a net

contributor, but there are some industries that are funded, such as

science. How great a loss that you think that is? We are hearing from

businesses and local authorities that they want guarantees from the

British government that that money, far everything from science parks to

railway stations, won't be lost. You work in the finance industry. How

does it change the dynamics if London is outside the EU? It is a

big question. The short answer is dramatically. We have providers from

the US situated in London and they trade on our platform across to

customers in France and Belgium. That can only happen because of the

European passport. We are present in all those countries without any

extra red tape with no extra red tape and we can sell everywhere.

That. And that will mean on the one hand that providers will have to

move into Europe, or they will have to take extra efforts and then they

will be regulated by a European regulator. I would actually say you

are wrong because I cannot see why the European passport cannot

continue. And I can't see why those elements of the free trade market

can't continue, because it is inevitably's interests. There has to

be a model that says we trade for the benefit of everyone and there is

a limit on the free movement of people. That has never been done but

what is wrong with that? I think we need to, all of us, work together at

a national level, business, unions and government. We need to roll up

our sleeves but what is clear that there wasn't a plan. What would your

vision be? Let's be clear that as soon as article 50 is triggered,

then the UK's powered brains by each month that negotiation goes on.

There is a. We have all pointed out the democratic decision. The TUC's

preference if we are stuck with this decision as we go for the normally

model, but as we said throughout the campaign, you cannot have your cake

and eat it. If you want access to the single market you have to have

free movement and you have to have rights for working people. I am

going to ask that question, why is it so central to the idea of free

trade that you must also have free movement of workers? We have to make

sure in the EU that we are competing on a level playing field. And the

level playing field that Hermans for example that there cannot be for

example child labour in the UK or certain working hours would be in a

framework. Creating those kind of agreement actually makes it possible

to compete without any extra barriers. Let me finish. Free

movement is so important for the EU because we have countries which do

not have the kind of industry where their population can work. We need

to provide them with them, and make sure sophisticated countries like

the UK get skilled workforces. The world has changed and the business

plan of Europe has not changed with it. I would like to ask you about

going for award what sort of trade relationships you might set up

outside the EU. We have special relationship with the US and you

have hinted that fast growth in the US and China. What I would like to

do, and I will make an appeal right now, I don't want the civil service

doing all of this. I would like some overseas help. New Zealand were left

in the lurch by us and they have offered help, take it! I would like

the unions and business and skilled negotiators from professional

services and people like me who have done them before to be brought ten

and this is our country and we should pull together and have

working parties to do one with America and China and India and

obviously the EU. Try to use the power of trade to get a good working

relationship with developing countries to actually help them. Do

you think this is an opportunity to offer a more level playing field? I

really hope so, I hope that as a wake-up call at a practical level.

If we take that approach to getting new trade deals vendor has to be

something at the heart of it that is for working people, it has to be

about good jobs, skills and workers' rights. If we can do that, I think

we will avoid some of the problems we have over the TTIP deal. We need

to be very clear from the start that if we build that kind of consensus

we can avoid some of the mistakes. Do you see from outside the UK that

actually this is a concern about globalisation, or do you see it as a

more specific UK concern about its position within the EU? Excellent

point to make because what we are experiencing here, the symptoms are

not new, the globalisation symptoms. We have unique situation where the

work that can be done doesn't need to be done by the people in the same

place, it can be done anywhere. We have another challenge coming up,

optimisation. The challenges are huge and I believe in the EU we can

work better together instead of fighting each other. You want to get

the best deal for yourself. I don't the best deal for yourself. I don't

want to negotiate with somebody who just wants to get the best deal, I

want a compromise for both sides. I want to see enlightened

self-interest which is the best deal for a hard-working person in North

England, and if that lifts the living standards for someone in the

south of Greece I am thrilled, but I don't see either of those things

being satisfied at the moment by Brussels. Do we have time because in

the interim there is uncertainty. How quickly can thread agreements be

pulled off a new experience? It depends on what both parties want

out of it. We have never been here before, any of us. If they a will

from others and if we got it together, these countries would want

to do the deal, because we so engaged. A brief thought? You could

prepared to sell your granny but prepared to sell your granny but

that is not the deal we want. You don't know my granny! We can

imagine. We need good deals but we need to be honest. The economy is

already potentially facing damage as already potentially facing damage as

the result of the delay. It would be an absolute mistake now to cut jobs

and services in the public sphere, the priority must be public

investment in infrastructure and house-building to keep that demand

going through this very difficult period. Do you think Germany will

come round to seeing the bigger picture? The bigger picture for

Germany will be that we need the EU even if Great Britain is not part of

it. We will do everything to protect the EU and make sure this does not

damage internal relationships and in order to do that there will be a

price that someone has to pay and that has nothing to do with being

nasty. No punishment at all. We want to make sure that Europe as we build

it together will continue to exist and for that reason it will be very

difficult to find. You have other opportunities, China and India and

there might be things you can do what you couldn't before. We will be

watching and observing and learning and let's see how the situation

develops. Thank you, to all of you. That is out from Talking Business

but join us again next week when we will be in New York examining the

state of the American economy as the country prepares to elect its next

president. Goodbye.