Cameron scathing over EU’s financial cowardice

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David Cameron delivered a scathing assessment of Europe’s failure to promote economic growth yesterday as he urged it to be “bold” to promote business.

The Prime Minister said it was no time for “tinkering” and described European Union plans for a financial transactions tax as “madness”.

In a speech to the World Economic Forum in Davos, he was strongly critical of what he said were anti-competitive Brussels regulations and the flawed framework for the euro.

“In Britain we are taking bold steps necessary to get our economy back on track, but my argument today is that the need for bold action at European level is equally great,” he said.

“Europe’s lack of competitiveness remains its Achilles heel.”

The annual gathering comes amid renewed gloom about the economy after the International Monetary Fund this week downgraded its forecasts for global growth. Britain is facing the prospect of a return to recession after the Office of National Statistics yesterday reported a 0.2% contraction in the UK economy in the final quarter of 2011.

Mr Cameron accused the EU, despite the economic challenge, of “doing things to make life even harder”.

He attacked the “unnecessary “ regulations on business that “can destroy jobs” and said the proposed financial transactions tax could cost hundreds of thousands of jobs. Even to be considering this at a time when we are struggling to get our economies growing is quite simply madness,” he said.

The Prime Minister suggested the eurozone had none of the features common to successful currency unions like the US dollar and British sterling.

“A central bank that can comprehensively stand behind the currency and financial system, the deepest possible economic integration with the flexibility to deal with economic shocks, and a system of fiscal transfers and collective debt issuance that can deal with the tensions and imbalances between different countries and regions within the union,” he said.