8 December 2015 World Outlook 2016: Managing with less liquidity of the US. The government needs to balance the competing objectives of a swift enough vote to retain investment, but allowing sufficient time for negotiations with Brussels. EU membership renegotiations will begin at this month's European Council meeting. A deal seems more likely at the February Council meeting at the earliest. Mr Cameron's four themes for renegotiation are explored in our 27 November Focus Europe, but in short the key demands are: i) improving competitiveness by reducing red tape and deepening the Single Market - where work is already under way, ii) economic governance - ensuring that rules governing the euro area are not automatically imposed on the UK, iii) returning greater sovereignty to the UK - the 'Europe where necessary' philosophy, and most contentiously iv) constraining migration by use of the benefits system. The vote looks likely to be closer than the last EU referendum in 1975 when the tally was 66% for remaining in. Polls have swung towards those favouring exit recently, with some even showing a majority wanting to leave. However, the average poll shows "In" slightly trumping "Out" (around 43% vs 40%). But similar to 1975, a government campaigning to remain in, supported by the opposition and the media in general, may well produce a vote to remain in the EU - albeit in modestly amended form. Still, we should expect a bumpy ride between now and then as some polls raise the risk of exit. European politics: Testing times to continue into 2016 The environment for European policyrnakers has become even more challenging following the terrorist attacks in France in mid. November. Managing (and containing) the massive influx of refugees since the summer was already keeping many EU member states busy, above all Germany. The controversial decision on a quota for the redistribution of refugees and the lack of full application of European rules has provid