On Thursday, Britons will vote in a referendum on whether to remain as members of the European Union. As an entrepreneur from the U.K. who has done business in continental Europe and around the world, the prospect of a British exit from the EU fills me with worry and fear.
We in the U.K. have always been reluctant Europeans. Prime Minister Clement Atlee once dismissed the postwar project as "six nations, four of whom we had to rescue from the other two." The U.K. eventually joined in 1973, on its third application, after twice being vetoed by France's President Charles de Gaulle.
Now spanning 28 countries and encompassing more than 500 million consumers, the EU has come to play an important role in the success of the British economy. Over the past four decades, per capita gross domestic product in the U.K. increased by an average of 1.8% annually, compared to 1.7% for Germany and 1.4% for France.
Leaving the EU would cause economic mayhem. The British government estimates that an exit would tip the economy into a yearlong recession, causing a 3.6% fall in GDP and 500,000 lost jobs. As EU members, British firms have been able to source goods and services from and sell them to the Continent. In total, 75% of U.K. businesses that trade goods internationally do so with the EU.
For me, these aren't just abstract statistics but also part of the story of my success. After I set up Travelex, my currency-exchange business, in 1976, the first countries we expanded into were Belgium and the Netherlands.
A central claim of the Leave camp has been that the U.K. would be able to negotiate better access and better trade deals once outside the single market. This is categorically wrong. As a member of the EU, the U.K. can play a role in shaping the laws of the single market. Once outside, the U.K. would still be required to pay for access and effectively accept the free movement of people. But it would no longer have any influence over the rules.
This is the case with Norway and Switzerland, which aren't members of the EU and are often considered models for a post-EU U.K. As a Norwegian minister once remarked, "if you want to run Europe, you must be in Europe. If you want to be run by Europe, feel free to join Norway."
The U.K. would also lose many of the benefits it enjoys as a full member, notably the guarantee of free movement of goods, services, capital and people. This point has been spelled out by Germany's finance minister, Wolfgang Schäuble: "If the majority in Britain opts for Brexit, that would be a decision against the single market. In is in. Out is out."
Walking away from membership in the single market would be self-harming, causing uncertainty, instability and economic stagnation. The U.K. would need to negotiate a new relationship with the EU. And while the rules require that such negotiations be completed in two years, it's important to remember that the EU's deal with Canada has taken seven years and still hasn't been ratified. Pascal Lamy, the former director of the World Trade Organization, estimates that negotiations for an EU-U.K. trade deal could take up to 15 years to complete.
Leaving would also hamper the U.K.'s trade relations with other countries, as all 53 of the EU's existing trade pacts would have to be replaced. The immediate losses would be substantial. Through just one such deal, the free-trade agreement between the EU and South Korea, U.K. exports to South Korea grew by 30%. Financial services would be particularly vulnerable, since the sector accounts for almost 10% of the U.K.'s economic activity.
Meanwhile, economic powerhouses like the U.S. and India are already negotiating trade deals with the EU, from which a post-EU U.K. would be excluded. President Obama famously warned that the U.K. would be relegated to "the back of the queue" for trade talks. That's quite a fall in stature from where the U.K. currently sits.
The U.K. would also risk losing the investments made by foreign companies that have used Britain as a gateway into the Continent. Sixty percent of all European headquarters of non-EU firms are based in the U.K. In a recent survey of British and U.S. companies, 88% of respondents said access to the single market made the U.K. a more attractive investment destination for their companies. Many would be jeopardized if the U.K. should leave.
A "Brexit" risks British growth, jobs, investment and trade. It would damage the U.K.'s access to the single market and the quality of its trade deals with the rest of the world. Britain's economy, its entrepreneurship and its strategic standing in the world all stand to lose. It would be the biggest own-goal in Britain's postwar history.
Mr. Dorfman is the founder and president of Travelex and the chairman of The Office Group and Doddle.
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