Tuesday 26 September 2017

Cameron urges leaders to do more in stamping out crisis

UK Prime Minister David Cameron speaks to business leaders at the B20 business summit yesterday in Los Cabos, Mexico.
UK Prime Minister David Cameron speaks to business leaders at the B20 business summit yesterday in Los Cabos, Mexico.

Eric Martin

UK Prime Minister David Cameron urged the European Central Bank and the eurozone's strongest economies to do more to stamp out the region's financial and economic crisis.

Speaking in Los Cabos, Mexico before a meeting of Group of 20 leaders, Mr Cameron said nations need to sustain their push for banking and fiscal reform because they can't spend their way out of the economic crisis.

He urged policymakers to address instability in the eurozone and government indebtedness by combining short-term monetary "activism" with long-term reforms aimed at boosting competitiveness, all the while avoiding protectionist trade barriers that slow global growth.

It "won't be easy" for Greece to take the steps required to stay in the 17-nation eurozone even after the nation yesterday elected a party that promises to keep bailout aid flowing, Mr Cameron said.

"The eurozone has two choices," he said. "Either they try to force down wages and prices in the periphery as fast as they can to restore competitiveness, with all the political and economic tensions that will entail, or the core of the eurozone has to do more to support the periphery through greater fiscal burden sharing."

Amid the UK's first double-dip recession since the 1970s, Mr Cameron's government is pushing ahead with the largest budget cuts since World War Two, pointing to Greece as a reason.

Mr Cameron and UK Chancellor of the Exchequer George Osborne have staked their reputations on creating jobs and investment in the private sector to replace public spending.

The Labour opposition says the policy has failed and has urged the government to switch course.

Budget cuts, a squeeze on households as inflation of 3pc outpaces wages and turmoil in the euro region -- the biggest market for British goods -- are weighing on a UK economy that has recovered barely half of the output lost in the recession of 2008 and 2009. (Bloomberg)

Irish Independent

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