Wales Office Minister Lord Bourne today said that a vote to leave the European Union is a leap in the dark that Wales cannot afford to take.
During a visit to leading Welsh clothing retailer, JoJo Maman Bébé, the Minister warned that, in the event of a Brexit, small and medium businesses could face a future of negotiations and uncertainty.
The Treasury recently predicted that the Welsh economy would be tipped into recession and unemployment could rise by 24,000 if the UK votes to leave the EU.
Wales Office Minister Lord Bourne said:
The consequences of leaving the EU span across everything from Welsh businesses and the steel industry to the environment and food produce.
Businesses across Wales rely on our deep links with the single market which, in recent years, has been a core part of our economic growth.
It is important that people understand that no alternative would include full access to the single market and every alternative would mean years of negotiations and uncertainty for Wales.
We must recognise the opportunities that access to the EU’s market represents and make the right decision to ensure a strong, stable future for Wales. A vote to leave the EU is a leap in the dark that Welsh businesses cannot afford to take.
The EU is a major driver for businesses of all sizes across the country - such as Newport based Jojo Maman Bébé. This Welsh success story now employs over 600 people and sells to 46 countries around the world. This would not have been possible without our membership of the European Union.
Founder and Managing Director of JoJo Maman Bébé Laura Tenison MBE said:
There is much written about the pros and cons of staying in the EU - good, persuasive arguments on both sides.
The one issue that economists agree on is that change creates uncertainty, which is bad for business. If Great Britain votes to leave the EU the inevitable uncertainty will put capital expenditure projects on hold.
Consumer confidence will stall as the threat of head office relocations to Germany is decided. The stable economic period we are experiencing will come to a grinding halt and it is highly likely we will return to recession which will lead to redundancies across our business and many others.
It is clear that Wales currently benefits from the UK being a member of the EU and Treasury analysis shows that around 100,000 jobs in Wales are linked to the UK’s exports to other EU countries.
This is in addition to £3 billion of inward investment from EU members over the last 5 years, with around 100 different foreign investment projects in Wales, creating or safeguarding around 32,000 jobs.
A vote to leave would be a profound economic shock that could cause unemployment across all age groups in Wales to rise by around 24,000 while youth unemployment could rise by 3,000. The impact of the shock from leaving the EU by 2018 could be equivalent to a £2.0 billion reduction to the size of the Wales economy today.
It could also mean house prices are £20,000 lower by 2018 in Wales than if the UK had voted to remain, assuming that had the UK voted to remain house prices in the region would have grown in line with the OBR UK house price forecast.