European countries would counter the economic shock of a British vote to leave the EU by accelerating plans for closer integration, the French finance minister has said.
Michel Sapin said Europe was undergoing a recovery after eight years of almost zero growth and would be reluctant to allow a “shock to the European economy” to jeopardise it.
He warned Britain would lose influence following a Brexit vote, which would probably encourage the 27 remaining EU members to draw closer together to protect themselves from a downturn in growth.
He said: “If the UK chose not to belong to the EU, I know it will be a shock for the rest of Europe. Denmark and Sweden, I don’t know, but it’s a personal opinion that they will want to get closer to the euro.”
Sapin, who was in London on Thursday to attend David Cameron’s anti-corruption conference, is a close ally of President François Hollande and has recently helped force through changes to the labour market, bypassing the French national assembly.
While reluctant to comment on the vote, saying it was a matter for the British public, he said if the UK voted to stay inside the EU, governments would implement demands from voters across the bloc for greater simplicity, transparency and democracy. “This is something we must press ahead with in the coming years,” he said.
If the UK voted to leave, he said: “It would be fanciful to believe this would not have any consequences.”
London’s status as a global financial centre would probably be affected as banks in the eurozone looked elsewhere to conduct their business.
“The City (of London) is a considerable financial force and I don’t think that (Brexit) would transform all the elements that constitute its strength,” Sapin said. “But I don’t think that it would be without effects, which would have to be seen.”
Some French banks had told him Brexit would have consequences for them and that some of their activities based in London might not carry on as they were, Sapin said.
The finance minister’s comments were echoed by a senior economic adviser to President Barack Obama in an interview for a German newspaper.
Jason Furman, the chairman of the White House council of economic advisers, said a vote to leave the EU would hurt Britain, Europe and the global economy.
“You can certainly argue about whether the damage Brexit would cause would be small, medium or big but it would definitely cause damage, especially for the Brits but also for the Europeans and the global economy,” Furman said in an interview with Handelsblatt.
“We don’t need more uncertainty at the moment.”
