Business world splits over EU referendum

Norway and Switzerland's equivocal approach to the European Union does not offer a viable alternative to membership for Britain, the CBI has concluded.

Its dismissal of the Norwegian and Swiss approaches to Europe appears to confirm British businesses are divided over whether or not a British exit from the EU would be to the country's advantage.

Norway's approach – being a member of the European economic area – is rejected because the economic benefits of direct access to the single market are undermined by practical barriers and realities.

Switzerland's free trade agreement has only been partially successful, the CBI concluded, because it has found itself with no option but to 'autonomously introduce' similar regulations to the EU.

"The test for those arguing that the UK must remain in the EU and for those pressing for our departure is to come up with a clear vision of our future, inside or out," the CBI's chief policy director Katja Hall said.

"Whether we are in or out of membership we will still need a relationship with the EU.

"But Norway and Switzerland simply don't appear to have set-ups the UK should aspire to. They are half-way houses on the margins of Europe with no influence over the market rules under which they operate."

Its conclusions will be of concern to the prime minister, who has sought to win over the CBI with promises of a relentless focus on jobs and growth.

His renegotiation of the EU is prompting uncertainty among investors, however – and leaving the City nervous about the future.

"Norway and Switzerland might not provide an off-the-peg solution for our EU relationship but, as the sixth largest economy in the world, Britain is well positioned to negotiate a bespoke deal," the Business for Britain campaign's chief executive Matthew Elliott said.

"Nobody is suggesting a copy-and-paste solution, so I hope that this report doesn't discourage the government from its plans for a fundamental change in Britain's relationship with the European Union."

The CBI report comes ahead of today's private member's bill debate on the EU referendum, when Conservative backbenchers will seek to legislate to guarantee an in-or-out vote in the next parliament.