George Osborne criticises India over economic protests

 
Warning: George Osborne on the Hong Kong MTRC CEO Jay Walder, said blame games could destabilise the recovery
20 February 2014
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George Osborne today warned against a bitter “blame game” as bickering between the world’s major economies threatened to derail a G20 agreement on how to safeguard a global recovery.

In a heavy slap-down to India and other countries complaining about the withdrawal of western economic stimulants, the Chancellor said it was no time for “finger-pointing and distractions”.

“We all need to get our houses in order,” he insisted, saying they should be sorting their own problems rather than looking to America and Britain to bolster them.

Mr Osborne is flying tonight to Sydney, Australia, to sit down with finance ministers and central bankers from around the world. But a serious divide is overshadowing the talks as developing countries demand another global deal to carry on stimulating growth, while the US seeks to taper off quantitative easing.

“There is a danger that in Sydney ... the G20 descends into a blame game and we miss the opportunity to drive through together the reforms that are necessary,” he said.

Mr Osborne warned that “a new crisis” could blow up in future unless “we all confront our problems instead of running away from them”.

He urged: “Together we need to act now to ensure that emerging market problems don’t contribute to a new crisis.”

The Chancellor argued that the G20 should set itself a role of holding governments to account for making necessary reforms, “rather than allowing them to escape responsibility by blaming their problems on others”.

Mr Osborne did not name any countries, but his tough words seems to be aimed at India‘s central banker Raghuram Rajan who has accused the US of running selfish policies that have caused turmoil in emerging markets.

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India, Turkey and South Africa have all raised interest rates recently to protect their currencies after investors turned back to the developed world. This week, Russia has also come under pressure.

In the same speech, to Hong Kong businessmen, Mr Osborne warned that the Budget in four weeks will confront “hard truths” about Britain’s problems.

He signalled moves to stimulate exports rather than giveaways, saying he wanted to see “Made In Britain” around the world.

It would be a “huge mistake” to declare “job done”, he said, saying the economy was too dependent on consumers spending money.

“So I’m not the first to say that the recovery is not yet secure and our economy is still too unbalanced,” he said. “We cannot rely on consumers alone for our economic growth, as we did in previous decades. And we cannot put all our chips on the success of the City of London, as my predecessors did. Britain is not investing enough. Britain is not exporting enough.”

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