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Citi: EU Only Thing Keeping Britain From Becoming A Third-World Country

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As long as threats are being issued over the matter, Citigroup would like to remind the U.K. that without the EU, it is just a small island country that is no easier to get to from New York than Frankfurt.

The British Bankers’ Association has sent a submission to a Treasury review that counters fears over the split of powers between London and Brussels, saying the current balance was “broadly appropriate”. It added there was an “overwhelming” case for more resources to be devoted to relations with Europe and warned that the UK was significantly underpresented in Brussels.

In a sign of the concern in the City over the outcome of David Cameron’s pledged referendum on EU membership, Citigroup has separately made an explicit warning to the Treasury about the costs for the UK economy if Britain were to leave Europe.

Citi said that if the UK were to disengage significantly or completely from the single market the implications could be “dramatic”. The UK population would face a drop in living standards as a result of lower wages or a weaker pound so that the same export performance could be maintained within the EU….

“It’s not that international companies will stop investing in Britain, but their investment just won’t be at the scale we have become accustomed to,” he said.

City bankers warn against UK's potential loss of influence in EU [FT]