Cameron pledges to British business leaders to secure growth

21st November 2011, Comments 0 comments

British Prime Minister David Cameron pledged Monday to business chiefs that his government will safeguard recovery, but warned there was no "silver bullet" amid the "chilling" eurozone debt crisis.

Cameron was addressing the annual conference of the Confederation of British Industry (CBI), which is calling this year for exports to be placed at the heart of government policy in order to strengthen economic activity.

Ahead of his appearance at the business gathering, Cameron unveiled ambitious initiative to encourage first-time buyers and stimulate the nation's dismal property market.

"We meet at a serious time for our economy -- and for business," Cameron told delegates at the annual gathering of Britain's biggest employers' organisation.

"We are trying to recover from a deep and difficult recession. Yet growth is slow in Britain, France and Germany.

"I am absolutely clear about the right answer for the UK economy. It can be summed up in one sentence: we need to deal with our debts and go for growth."

There would be no let-up in the coalition's determination to slash the deficit and avoid the kind of sovereign debt crisis that has wreaked havoc in the eurozone and now threatens Italy and Spain.

The premier also revealed Monday that finance minister George Osborne will unveil plans to boost credit for small and medium-sized businesses, and ramp up infrastructure investment in an autumn statement on November 29. The extra investment would not be funded by borrowing.

The CBI began its annual gathering with a call for the coalition government to champion the nation's exports -- with a particular emphasis on tapping into fast-growing emerging markets to offset the impact of the eurozone debacle.

"Today we are focusing on the critical driver of growth: exports," said CBI President Roger Carr.

"Our message is the urgent need to prospect and build in new growth markets rather than continue to harvest the traditional -- and currently less fertile -- markets of our close neighbours."

Britain's economy grew faster than expected in the third quarter, expanding by 0.5 percent between July and September, but the outlook remains clouded by the eurozone crisis, government spending cutbacks and high inflation.

The CBI is urging the government to help improve Britain's trade performance with a raft of proposals that would lift gross domestic product by an estimated £20 billion by 2020.

Measures include achievable performance targets for high-growth markets, the breaking down of domestic barriers and improved access to export finance.

The CBI wants the government to match the European Union's average of one-in-four small-to-medium sized enterprises (SMEs) exporting by 2020. That compares with Britain's current level of one in five.

Cameron meanwhile added that his coalition administration was pressing ahead with major infrastructure projects, including improvements to roads, railways, broadband Internet services, power stations and shipping ports.

Earlier on Monday, the premier had launched plans to help boost home loan financing for first time buyers, pledging to support new mortgages for up to 100,000 people who would otherwise be locked out of the housing market.

Turning to the eurozone debt crisis, he said that confidence had been ravaged by uncertainty in financial markets, with markets now fretting over debt-laden pair Italy and Spain.

"Paralysis in the eurozone is causing alarm in the markets and having a chilling effect on economies in many countries -- including our own," Cameron said.

"When the nightly news is about rising interest rates in Europe and uncertainty about the future, it is not surprising that this affects business and consumer confidence."

The Conservative-Liberal Democrat coalition has sought to slash spending ever since it rose to power last year, when it ousted the previous Labour administration and inherited a record public deficit.

However, the premier stressed on Monday that there would be not be "one silver bullet" to restore business confidence and fix Britain's flagging economy.

The conference was also addressed on Monday by British Foreign Secretary William Hague and Turkish President Abdullah Gul, who called for more British firms to strengthen their ties with Turkey and tap into the emerging market.

"We need to stimulate growth and create new jobs. It is all the more important today to further strengthen Turkish-UK business links in order to overcome economic difficulties," said Gul, who begins a state visit to Britain on Tuesday.

© 2011 AFP

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