UK Trade Minister backs European Central Bank rate cuts

6th Jun 2014 11:44

UK Minister of State for Trade and Investment Ian Livingston supported the European Central Bank's moves to kick-start the eurozone economy at a conference in Spain on Friday.Livingston, pictured, told the meeting in Madrid that the Eurozone's monetary authority was simply being "sensible" in cutting rates as it recognised that the European economic recovery was uneven and there were certain members that needed a push.The ECB on Thursday reduced interest rates by 10 basis points to 0.15%, less than the 15 basis point cut expected by analysts, and cut the deposit rate from 0% to -0.10% in an unprecedented move.The Minister and peer, who was formerly Chief Executive of British telecoms group BT, also pointed out that the UK was in a different situation to its continental neighbours because inflation was less of a problem.Nevertheless, Livingston said it was not his responsibility to determine whether the ECB should align its policy-making with that of the Bank of England or the US Federal Reserve.Livingston also declined to compare independence movements in Scotland and Spain during the conference attended by Webfg Media, which owns Digital Look, Sharecast and Bolsamania.com. He said he was not qualified to comment on Spanish political issues such as any similarities between Scotland's "Yes campaign" and that of Spanish region Catalonia, whose capital is Barcelona, which also seeks to hold a referendum this year.He did, however, claim that an independent Scotland would need to re-apply for EU membership and leave sterling. Livingston added that he believed Scotland would reject independence in the referendum in September.On UK calls for EU reform, Livingston backed Prime Minister David Cameron's view that the status quo was unacceptable and that changes were needed. But while the minister said joining the euro was not in the UK's interest, he claimed Britain also had no interest in distancing itself from the EU but rather wished to focus on the need for reforms. Livingston did not reveal his choice for the next President of the European Commission, insisting there were many candidates but that the UK's choice would be based on a person who looked to the future. Cameron, who has bowed to pressure from anti-EU lawmakers in his party by announcing plans for an EU membership referendum if the Tories win the next election, is trying to block the appointment of former Luxembourg Prime Minister Jean-Claude Juncker on the grounds that he is too federalist.MG