London Briefing Chris JohnsMost analysis of Tony Blair's U-turn on the EU constitutional referendum has concentrated on the underlying motivation: why the dramatic change of heart?

It has become a cliché to describe the prime minister as a high-stakes gambler, but it seems that such a description has never been more apposite. If Blair were to hold the referendum tomorrow he would lose and would have to resign as prime minister.

Clearly, he thinks that he can win the argument and convince sceptics to change their minds. Credit where credit is due: it is both a correct and brave decision. And one with ramifications for the whole of Europe. Cynics are already saying that the timing and wording of the referendum will be such that many people will be bullied into voting Yes.

The Neill Commission has previously recommended that the machinery of government be kept away from a referendum, something that Labour will, of course, ignore. If the referendum question even hints at Britain's membership of the EU, many will be forced to vote for it.

Even if the wording contains no explicit or implicit reference to leaving the EU there will be plenty of people - on both sides of the debate - who will try to make the link. If this part of the process gets out of control, the consequences could be very serious indeed.

The reaction from the rest of Europe has been predictably uneasy.

John Bruton accused Mr Blair of showing "no leadership on European issues". One is tempted to ask which European politician has shown any European leadership in recent years; Blair is in very good company.

In France, they are clearly concerned that pressure for a similar referendum will now build, and Brussels must be very worried that either the French or the British are going to say No. The smaller countries, like Ireland, are on notice that the results of their own referenda are not going to matter one way or the other, but a big country No will represent a different ball-game.

Mr Blair faces a huge uphill struggle to convince the British people that the EU constitution is a good idea. Additionally, many people are keen to have a go at the prime minister: the referendum will provide the perfect excuse to give him a bloody nose.

If the prime minister feared that the next general election was likely to provide voters the only opportunity to take a swing at him, the EU constitution may draw the electorate's sting; having vented some steam, the public might feel more able to grant Labour a third term, albeit perhaps with a different prime minister.

Whatever the rationale we are going to witness a bruising battle, one in which big business cannot fail to get involved.

Expect to see the list of usual suspects line up in favour of the new constitution. That list will range from Niall Fitzgerald to Japanese car makers: all will make predictions about the dire consequences of a No vote.

Trouble is, the evidence is building that Britain's exclusion from the euro and semi-detached EU membership status have not prevented an ongoing economic renaissance.

Unemployment continues to fall, the economy continues on its steady growth path. Britain's capacity to absorb immigrants attracts a lot of hostile tabloid press, all of whom miss the point that virtually all of these new citizens are going straight into jobs. It is a remarkable story.

Evidence is building that the City is thriving again and, on some measures, is set to overtake New York as the world's financial capital.

According to the Europhiles we should by now have seen London's demise as a financial centre with Frankfurt and Paris battling it out for European supremacy. Exactly the opposite has occurred.

The economic arguments will be interesting to observe; I guess that the pro-Europeans will talk about the coming restructuring of Europe and that Britain cannot be left outside. There will be lots of trains about to leave the station, lots of "Britain's last chance to get aboard". Anyone over 25 will suspect that they have heard all this once or twice before.

Much of the campaigning infrastructure built up for the euro has recently been dismantled; both sides packed up and went home as soon as it became clear that the debate had been won by the "Business for Sterling" campaign. All of these people are going to have to return to the hustings and do it all over again. With, I suspect, the same result.