Regulation Fatigue

The British Businesses Battling for Brexit

FILE - epa05299338 Former Mayor of London Boris Johnson poses as he launches the Vote Leave Bus Tour in St Austell, Cornwall, Britain, 11 May 2016. Boris Johnson is supporting the Brexit campaign touring the country with a bus. EPA/STR UK OUT (Zu dpa "Boris Johnson vergleicht EU mit Hitler") +++(c) dpa - Bildfunk+++
Former Mayor of London Boris Johnson campaings in Cornwall. The Leave camp is making gains in the polls.
  • Why it matters

    Why it matters

    The British referendum is the starkest sign yet of disunity in the European Union, which traces its beginnings to the 1950s.

  • Facts

    Facts

    • The U.K. referendum on European Union membership takes place on June 23.
    • The so-called “Brexit” is opposed by British prime minister David Cameron.
    • Polls on Monday showed that potential voters are more likely to vote Leave than Remain.
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British businessman Christopher Nieper hurried through his factory as sewing machines hummed.

The 50-year-old is the second generation to head the family-firm David Nieper, which makes women’s fashion and sells them via catalogs. The boss wasn’t focusing on the people working at the sewing machines but instead fixed his gaze on a storage room that contains equipment that embodies his problem with the European Union: A stepladder.

“For health and safety reasons, we have to allow this ladder to be regularly monitored,” said Mr. Nieper as he shook his head. “Every month, someone comes, takes out the ladders, counts the stepladders. Then we have to fill out a form, make an X and so forth.”

He sees this not as a minor irritation but as a fundamental woe that illustrates the European Union’s widespread regulatory folly.

“This is an example of Brussels’ utterly superfluous compulsion to regulate,” Mr. Nieper said.

“This is an example of Brussels' utterly superfluous compulsion to regulate.”

Christopher Nieper, Boss, David Nieper

With his factory in an industrial district in the small town of Alfreton some 200 kilometers, or 124 miles, northwest of London, Mr. Nieper is not only geographically removed from the British capital. He has also distanced himself politically from Britain’s Conservative prime minister, David Cameron. Mr. Nieper is an avowed opponent of the European Union and thus part of a small but vocal minority of British firms that collectively has acquired great importance.

In 2014, the British business community gave near-unanimous support to Scotland remaining in the United Kingdom, and the community’s stance influenced many voters in the referendum on the issue. Those supporting Scottish independence failed to garner enough votes.

In the current campaign leading up to the British referendum about the nation’s continued membership of the European Union, the business community isn’t united in its stance on the issue. It isn’t the large companies but instead the heads of small and mid-sized firms who are voicing loud support for Britain leaving the 28-nation bloc. Supporters of the so-called “Brexit” are making life difficult for Mr. Cameron, who supports the country’s continued E.U. membership.

A leading spokesman for the Brexit movement, the former London mayor Boris Johnson, accordingly chose to demonstrate solidarity with Mr. Nieper. In mid-May, Mr. Johnson visited the factory and – surrounded by a few garment workers and a horde of reporters – took a few more pokes at Brussels.

“The E.U. is like an ill-fitting piece of clothing that hangs too loose in some places and is dangerously tight in others,” said Mr. Johnson, a member of Mr. Cameron’s divided Conservatives, as he delighted photographers by briefly running an iron across an ironing board decorated with the “Vote Leave” slogan.

Economic reservations are playing a key role in the debate, and the number of Brexit supporters among companies has even risen recently. In the most recent survey by the British Chamber of Commerce, 37 percent of its members were in favor of a Brexit; in the previous poll, the figure was 30 percent. So it’s not only rabble-rousers but also staid entrepreneurs who are voicing what many in Britain think – that the country would be better off alone.

And the Leave campaign seems to be making gains. Three polls released on Monday showed a shift to the Brexit camp, causing the British pound to decline in volatile trading during the day. A YouGov poll showed 45 percent in favor of leaving, compared with 41 percent who would vote to stay in. A separate online survey by TNS showed 43 percent backing Brexit and 41 percent supporting E.U. membership. An ICM poll showed 48 percent in favor of leaving, up one point on last week, and 43 percent wanting to remain. However, the latest YouGov figures on Tuesday showed remain had retaken the lead by 1 percent.

Doesn’t Mr. Nieper fear any negative consequences for his business if Europe were to close its commercial borders to British firms? Sitting in his office, Mr. Nieper shook his head vigorously.

“It’s estimated that 94 percent of all firms in the United Kingdom don’t have any export business at all,” he said.

Small and mid-sized companies in particular send no or very few products to Europe, but they all have to submit to regulations from Brussels – whether they want to or not, he says.

“We are the fifth- or sixth-largest economy in the world and can stand on our own, if we want to,” Mr. Nieper said.

 

ALFRETON, ENGLAND - MAY 16: Boris Johnson, the former Mayor of London, irons a Vote Leave flag which was made during a visit to David Nieper Ltd on May 16, 2016 in Alfreton, England. Boris Johnson and the Vote Leave campaign are touring the UK in their Brexit Battle Bus. The campaign is hoping to persuade voters to back leaving the European Union in the Referendum on the 23rd June 2016. (Photo by Christopher Furlong/Getty Images)
Boris Johnson irons a Vote Leave flag during a visit to David Nieper. Source: Getty Images

 

But many reports and opinions that have rained down on Britons these last few months offer a very different picture: A British exit from the European Union would have grave consequences not just for the Continent. It would also have a heavy impact on Great Britain itself.

A study by the Bertelsmann Foundation, for example, says that leaving could cost the country more than €300 billion ($341 billion). U.S. banking giant Citigroup expects that a departure would significantly reduce Britain’s rate of economic growth. Over the next four years, growth could be as much as 4 percent lower, Citigroup economists warned recently.

But these are forecasts and warnings that don’t really scare Vote Leave supporters such as Mr. Nieper. He responds to all these figures, tables and statistics with one principal counterweight: his own experience.

“Just imagine, you go to your local supermarket and at the cheese counter, there is a piece of cheese from France and one from Switzerland. Would you then say, ‘I won’t buy the Swiss cheese because it doesn’t come from the E.U.?’ ” Mr. Nieper asked rhetorically. He then promptly gave his own answer: “From the customer’s point of view, that doesn’t make any difference: You buy something because you want it.”

So Mr. Nieper has decided: He’ll vote for the Brexit – and hopes that many Britons will do likewise.

“I’m optimistic,” he says. “We have a chance of winning.”

Mr. Cameron has a tough fight ahead of him – and not just in Alfreton.

 

Carsten Herz is a London correspondent for Handelsblatt. To contact the author: herz@handelsblatt.com

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