Oct. 31 (Bloomberg) -- U.K. Prime Minister David Cameron and his deputy, Nick Clegg, said the government is taking the right steps to boost economic growth by spending on regional projects and focusing on deficit reduction.
In an article for the Financial Times, Cameron said the euro-area debt crisis had had a “chilling effect on major economies around the world.” He said it hadn’t changed the argument he will take to this week’s summit of the Group of 20 leading economies in Cannes, France.
“In spite of the difficulties, I am confident that we can both resolve the crises at hand and come through them with an economy that is stronger and fundamentally fairer,” Cameron wrote. “We can only do so if we show complete single-mindedness on three fronts: confronting our debts; strengthening the competitiveness of our economy; and unlocking global trade.”
The U.K. economy has barely grown over the past year and unemployment climbed to a 17-year high in the three months through August, fueling concerns Britain may slide back into recession. While economic growth in the third quarter probably rebounded from one-time disruptions in the previous three months, underlying activity is weakening and Bank of England Markets Director Paul Fisher predicted last week there is a “50-50” chance the economy will shrink in the fourth quarter.
With the opposition Labour Party arguing that the government should increase spending immediately, Clegg pointed to money he will allocate today to promote growth in depressed regions of the country.
“What we’re trying to do is invest public money, taxpayers’ money, into companies which can create jobs that last,” Clegg told BBC Radio 4. “And for every pound that will be invested from the Regional Growth Fund, we estimate 6 pounds will be matched from the private sector. So you’re making the money go much further, and you’re creating, or safeguarding, close to 325,000 jobs, jobs which are built to last.”
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