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Last Updated: Friday, 10 September, 2004, 07:37 GMT 08:37 UK
Brown sends tough message to EU
Gordon Brown
Mr Brown criticised Europe's low growth
The EU must sort out its problems with economic growth, Chancellor Gordon Brown has warned ahead of talks with European finance ministers on Friday.

Europe must escape its inward-looking mindset and tackle the growth problem, Mr Brown told the Financial Times.

The chancellor identified several problems in the world economy but focused on Europe's low growth as a potential cause of instability.

His meeting in the Netherlands will feature talks on the UK rebate.

Bullish

Mr Brown said those in positions of power in Europe needed to adopt a "sense of urgency" in tackling economic reform.

And he adopted a bullish stance ahead of the debate on the British rebate saying a European Commission proposal for a 30% increase in spending was "unacceptable".

The debate on the budget would become a test of whether Europe was "genuinely resisting grandiose but unrealistic ambitions".

Britain was still ripe for more reform, Mr Brown said, adding that he would use a pre-budget report later this year to focus on increased flexibility. He wants to boost UK productivity and is not afraid of pursuing controversial reforms.

Growth

The chancellor warned that "risks in the continuing imbalances caused by divergent growth rates in the US, Europe and Japan" could threaten the global economy.

Mr Brown did not attack high deficits in the US, instead focusing on European weakness.

He said Europe had managed 3% growth in only one year in the past 10, while the US averaged 3% over the decade.

The Financial Times suggested that Mr Brown's tough stance would do nothing to persuade people of the need for the new European constitution ahead of the planned referendum.




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The BBC's Evan Davis
"If Alan Milburn's new role has upset Mr Brown he wasn't admitting it."



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