Cameron Urges Free Trade Boost for EU

David Cameron
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David Cameron

U.K. Prime Minister David Cameron made the case for a free trade agreement between the United States and Europe in a speech at the World Economic Forum in Davos on Thursday, arguing in favor of the expansion of free trade as his country increasingly distances itself from the EU.

A day after he made a long-awaited speech on Europe in which he said his government was looking at how to repatriate more powers from Brussels, Cameron said the U.K. was not backing out of Europe, but wanted a more competitive bloc.

Cameron has made the establishment of a free trade agreement between the EU and the U.S. a key priority of the U.K.'s leadership of the G8.

"There's the beginning of negotiations on an EU-US treaty," Cameron said. "The EU and the U.S. together, we actually make up a third of all global trade. A deal between us could add over 50 billion pounds to the EU economy alone."

He called for a "massive boost" to free trade by "sweeping away bureaucracy" and said he wanted to use the G8 to drive a more serious debate on tax evasion and tax avoidance after "years of abuse". There was gathering political will to tackle the issue, he said.

"Europe is being outcompeted, out-invested, out-innovated. And it is time to make the European Union an engine for growth, not a source of cost for business, Cameron told delegates at the annual gathering in the Swiss ski resort.

"We need more free trade. We need fairer tax systems. We need more transparency on how governments and companies operate," he said. "When trade isn't free we all suffer."

In order to compete in the "global economic race" with other nations that are growing and changing fast, European countries needed to deal with their debt and cut business taxes, he said.

"This is not about turning our backs on Europe. Quite the opposite. This is about how we make the case for a more competitive, a more open, a more flexible Europe and how we secure the U.K.'s place within it."

He lamented the fact that some companies "navigate their way around tax systems and even low tax rates with an army of clever accountants" and called for greater transparency.