LONDON: With the Davos forum barely over, international economic and business luminaries re-grouped yesterday to discuss how best to breathe new life into the global economy and cope with growing competition from Asia.
Opening the one-day ‘Advancing Enterprise’ conference in central London, British Chancellor of the Exchequer Gordon Brown warned his fellow European finance ministers against shying away from tough decisions on economic reform.
“The best contribution we pro-Europeans can make to the cause of Europe is by ensuring that in Europe we face up to rather than duck the difficult decisions about economic reform,” he told delegates.
Brown, speaking a day after the 2004 World Economic Forum closed in Davos, Switzerland, also urged Europe and the United States to lay to rest a recent trans-Atlantic rift over US steel tariffs and to re-launch faltering efforts to liberalise global trade.
“Better trading relationships with the US and the rest of the world help, not hinder, Europe,” Brown said.
“We must do more to re-open the world trade talks by tackling agricultural protectionism,” he said, referring to a key factor in the failure of World Trade Organisation talks in Cancun, Mexico, in September.
The British, French and German governments had agreed to “strive to secure” the removal of tariff and non-tariff trade barriers between Europe and the US, Brown said.
Also due to take part in the conference, some by video-link, were the finance ministers of Germany, Ireland, Spain and the Netherlands, as well as European Central Bank president Jean-Claude Trichet, the latter fresh from Davos.
Also hooking up from the US were Federal Reserve chairman Alan Greenspan and Treasury Secretary John Snow.
Trichet outlined the importance of economic reform in the eurozone during his address to the conference.
“The main stability goal of the eurozone, as well as of the European Union as a whole, should be to increase substantially our growth potential,” he said.
“This is crucial, and calls upon increasing very significantly in particular our rate of employment, our labour productivity progress and our technological and scientific basis.”
Brown, meanwhile, warned delegates that the nature of the modern, global economy meant that firms in the US and Europe must face up to increasing competition from dynamic economies in Asia and elsewhere.
While in 1980 less than one tenth of manufactured exports came from developing countries, this figure had now risen to 25 per cent and was set to soar to 50 per cent in 20 years’ time, Brown said.
“By 2015 up to five million American and European jobs could have moved offshore – outsourced to countries like India and China as they strive to become the worlds second and third-largest economies,” Brown said.
British firms have in recent months moved a large number of jobs to India, mainly in telephone call centres, with trade unions warning that up to 200,000 posts could be lost eventually. – AFP
Last update on: 27-1-2004