EU membership is in UK's national interest - CBI

Businesses so far appear divided over the historic vote

Businesses should "speak out early" in favour of remaining in a reformed European Union, the president of the Confederation of British Industry says.

Sir Mike Rake will argue at the group's annual dinner that firms "must be crystal clear that membership is in our national interest".

There are "no credible alternatives" to EU membership, Sir Mike will say.

Prime Minister David Cameron has promised a referendum on the UK's EU membership by the end of 2017.

In the run-up to his speech, Sir Mike told the BBC's Today programme: "We need to remind ourselves that we're part of a market of 500 million people to which 50% of our exports go.

"Most businesses and governments want to see a reform that allows us to grow. Reforms can be made that we believe can improve our competitiveness without the need for treaty change."

This evening, Sir Mike will say that it is now time for business to "turn up the volume" on the "crucial issue" - "speaking out clearly and in a language which people can understand".

He will tell the 1,000 businessmen and women, and politicians: "In the months to come, our country will have to make its own choice. A choice between openness and isolation, between shaping the future or retreating into the past.

"The question is not whether the UK would survive outside the EU, but whether it would thrive."

Reform needed

But he will also call for the UK to redouble its efforts to secure EU reform.

"Reform will not happen overnight, but by working with our allies on an ambitious, yet achievable, agenda, we can make it a reality," he will say.

Businesses so far appear divided over the historic vote.

The British Chambers of Commerce director general John Longworth said on Monday that 55% of his members were in favour of a "reformed Europe", and said the "in-out debate is more nuanced than a lot of people would have us believe".

In contrast, the chairman of construction equipment maker JCB said that the UK had nothing to fear from the UK's exit from the European Union.

"We are the fifth or sixth largest economy in the world. We could exist on our own - peacefully and sensibly," Lord Bamford told BBC Midlands Today.

However, many have urged the government to bring forward the referendum to end the prolonged wait.

Mr Longworth said the in-out referendum should "take place as soon as is practical" and Labour party leadership contender Andy Burnham has also called for the promised referendum on Britain's membership to be brought forward.