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Merkel warns against protectionism. The British PM insisted he is not an isolationist and that he wants Britain to remain at the heart of the single market.
Free trade, transparency and a crackdown on tax cheats will be at the heart of Britain’s G8 presidency, Prime Minister David Cameron told the World Economic Forum in Davos on Thursday as he set out his vision for a more competitive Europe, CNN reports. The speech comes a day after Cameron made headlines by promising the British people a vote on European Union membership if he wins the next general election in 2015.”We need more free trade. We need fairer tax systems. We need more transparency on how governments – and yes, companies – operate,” Cameron told political and business leaders at Davos. These three issues will be the focus of the G8 meeting to be hosted by Britain later this year, he said. Cameron said the European Union and the all face the “looming, insistent question” of how to compete and succeed in the global economic race. He sees free trade as key to that success – saying that when it isn’t free, everyone suffers. He wants Britain to be outward-looking, Cameron said, as he insisted that his referendum promise was “not about turning our backs on Europe” but about making the 27-member bloc work for everyone. Cameron said the question of fairer taxes, more open trade and greater transparency apply just as much to the developed countries of the G8 as to poorer nations. And he dismissed the idea that speaking out on On Wednesday, Cameron promised that if his party wins the 2015 general election, the country will get to vote on whether Britain stays in the European Union on the basis of a renegotiated deal, or leaves. The referendum should not be held until it’s clear how changes made after the crisis in the eurozone work out, he said, but will be held in the first half of the next parliament. Cameron insisted he is not an isolationist and that he wants Britain to remain at the heart of the single market. But, he said, it was time to face the difficult questions over the future of the European Union, including how to make it more competitive and more adaptable. France and others have made it clear that Cameron cannot “cherry-pick” which elements of the European Union he signs up to, or risk unraveling the union to suit British interests. U.S. President Barack Obama has also said “the United States values a strong UK in a strong European Union.” But German Chancellor Angela Merkel gave Cameron some room for maneuver, indicating she was open to discussions on a “fair compromise.” In her speech at Davos, Merkel warned against protectionism. She told business leaders that governments need to continue efforts to bring borrowing under control while there’s political will and pressure to do so. She also lauded progress. The German Chancellor acknowledged the ongoing eurozone difficulties, though she also saidshe believed “that we have indeed made considerable progress in this area in the last few months.”Merkel called the World Economic Forum’s 2013 motto resilient dynamism – “fitting,” because it alluded to a dynamism that focused not on “speed at any price,” but rather on a system that could withstand economic shocks.Though the chancellor said that, for her, “budget consolidation and economic growth are two sides of the same coin,” she also warned against impulses to reduce the pace of reform in the face of economic stagnation. The conservative chancellor pointed to Spanish record unemployment figures released on Thursday as an example of the difficult balancing act, and said she understood the urge to balance the books during periods of growth.