Continued membership of the European Union would leave Britain with huge economic turmoil, akin to those affecting Greece and Spain, the chairman of JD Wetherspoon said, as he joined 249 other business leaders in openly backing Brexit.

Tim Martin, who founded the pub chain in 1979, said the EU was transferring power away from its member states and handing it to unelected officials in Brussels. As a result, he pointed out, countries like Spain and Greece that are struggling to drag themselves out of an economic downturn had no power over their own budgets and interest rates.

“Democracy has gone hand in hand with the highest level of prosperity for decades and decades and decades,” Martin said in an interview on BBC Radio 4’s Today programme on Saturday morning.

“West Germany was much more successful economically than East Germany; South Korea is more successful than North Korea. North America is the best example, with its democratic constitution; and look at South America, poor people who live in so many of the countries there haven’t had democracy, and which is the most successful country?

“People know this instinctively, people know this. We can have clever debating points, but democracy equals prosperity. If they take it away you are going to get Greece and you will get Spain and you will get the massive economic problems people are now having when democracy is removed from people. That’s the key issue.”

Martin’s comments came as the Vote Leave campaign announced that its business council will be chaired by John Longworth, the former director general of the British Chambers of Commerce.

In a statement, the campaign said that the council will make the case that EU membership is holding back British business. A YouGov poll commissioned by Vote Leave found a third of businesses see the EU as a hindrance.

Other business leaders backing the campaign include Joe Foster, cofounder of Reebok, Michael Geoghegan, former chief executive of HSBC, David Ross, founder of Carphone Warehouse, and the hedge fund manager Crispin Odey.

Matthew Elliott, chief executive of Vote Leave said: “We’re delighted that John Longworth has agreed to chair Vote Leave’s business council. His strong business track record and his courageous decision to share his true beliefs with voters makes him an extremely powerful voice in the EU debate.

“With our growing list of business supporters, Vote Leave will make that case that whilst the EU might be good for big multinationals, for smaller businesses it acts as a job destruction regulatory machine.

“Brussels hinders smaller businesses, particularly those firms who can’t afford to lobby Brussels to curry favour. Jobs, wages and our economy will thrive when we take back control and Vote Leave.”

The Guardian has contacted the Britain Stronger in Europe campaign for a response.