Reuters International

German Chancellor Angela Merkel attends a news conference following talks with NATO Secretary-General Jens Stoltenberg at the Chancellery in Berlin, Germany, June 2, 2016. REUTERS/Hannibal Hanschke

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BERLIN (Reuters) - German Chancellor Angela Merkel and European Central Bank chief Mario Draghi said they wanted Britain to stay in the European Union on Thursday, three weeks before Britons vote on the country's future in the 28-member bloc.

Merkel said if Britain chose to leave it would not be able to reap benefits from a free trade deal being negotiated between the European Union and the United States, and it would also miss out on the advantages of the EU single market.

"It is naturally the decision of the British people how to vote. I personally wish that Britain will remain a part of the European Union," Merkel said during a news conference after talks with NATO Secretary General Jens Stoltenberg.

"Why do I wish this?... I believe that when we sit together in the European Union, every side, including Britain, can make its argument more efficiently and better, and every result is better than when one does it from outside," she said.

Merkel wants the EU to complete negotiations with the United States this year on the proposed Transatlantic Trade and Investment Partnership (TTIP), whose supporters say would deliver more than $100 billion of gains on both sides.

Britain votes on June 23 on whether to stay in the EU, a choice with far-reaching consequences for politics, the economy, defence and diplomacy in Britain and beyond. EU leaders are counting on British Prime Minister David Cameron to carry the day in his campaign to avert a Brexit they fear would have deeply damaging economic and political effects on the bloc.

Speaking in Vienna, Draghi said the ECB remained ready for any outcome from the referendum and hoped Britain stayed in.

"The ECB has a view whereby the UK should remain in the European Union because the European Union will benefit from its permanence, and we believe the UK too will benefit from staying in the European Union," he said after the bank's policy-setting meeting.

The ECB, which was meeting in the Austrian capital, has cited Britain’s EU membership referendum as one of the key sources of political risk that could undermine the euro zone’s financial stability. Britain is outside the euro zone.

But the ECB has given no details about its own preparations for the referendum, and Draghi did not mention any such steps when asked about them in his news conference.

Merkel and Draghi added their voices to Dutch Prime Minister Mark Rutte and Spanish Prime Minister Mariano Rajoy, who have both warned of consequences for Britain if it voted to leave.

"I think it would be very bad news, for the UK, for the Netherlands, for Europe as a whole," Rutte told the BBC on Wednesday. "For two reasons. First of all, take the Netherlands and the UK. We are both seafaring nations. Our prosperity, our ability to create jobs, future growth, is built on the free market, is built on open borders," he said.

He added that a vote to leave would spark "an inevitable, unavoidable race to the bottom".

Rajoy told the Spanish news agency EFE on Thursday that Britons could lose their right to live in Spain if they voted to leave the EU, adding that scrapping free movement rights would be "negative for everyone."

(Reporting by Madeline Chambers, Noah Barkin and Francesco Canepa; Writing by Joseph Nasr; Editing by Mark Heinrich)

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