Sterling should be centre stage in the Brexit debate

Outlook

All the wrangling around the Prime Minister’s “concessions” from Brussels is making the Brexit debate so dull that I doubt more than 5 per cent of the voting population cares any more.

People feel like they are being spun and taken for fools by big business, on the one hand, threatening thousands of job losses if we leave, and by the pro-Brexit media, on the other, ranting about our lost liberties.

One FTSE chieftain with significant businesses in the UK, continental Europe and beyond was almost choking on his Dover sole this week about the whole charade. Despite being an “in-er”, he was furious about the scare stories from his chief executive peers.

Anyone running a global business, he said, knows external investors won’t really care if we’re in or out. Likewise, no German mayor will say “nein” next time he offers to invest in their city just because Britain is not in the European Union.

Rather, this debate should be about what we believe is our role in the world: are we British and European, or just British? Would we be proud, or ashamed, to be the generation that undid our ties with our European neighbours?

The one issue about Brexit that will affect us more than anything, he said, is hardly being mentioned: the impact on the pound. The gyrations of sterling are far more material than minute details of red tape for employers or immigration.

A weak pound boosts the power of his overseas earnings when translated back home, and encourages more foreign visitors to his UK operations. But it depletes his investment war-chest for overseas expansion and increases his operating costs. A stronger pound reverses those variables. So, all he wants to know for his business is, will sterling rise or fall?

On Thursday, Goldman Sachs gave him its answer: the pound will crash by as much as 20 per cent if we leave.

Net, that would be positive for my lunch companion’s business – ironic given his personal aversion to Brexit. Equally ironic, for smaller businesses not exporting, which tend to be more Eurosceptic, a weak pound would increase their bills and raw material costs.

Perhaps it is time sterling, rather than the finer points of immigrants’ welfare payments, becomes central to this debate.