UK recovery remains at risk from global economic problems

THE recovery of the British economy remains at risk from developments in the United States and Europe, Prime Minister David Cameron said yesterday.

But Mr Cameron said he remained convinced that the government was right to seek to eliminate the UK's structural deficit by 2015, and pointed to forecasts of GDP growth over the coming years from the Office for Budget Responsibility.

He played down reports of tensions with Liberal Democrat Cabinet members such as Business Secretary Vince Cable over cuts, insisting that he was "heartened" by the way ministers had "come together as a coalition" to agree the necessary action.

Mr Cameron said: "The forecasts from the OBR are positive, but of course there are risks to the British economy: What will happen to the American recovery? How strong is the recovery in Europe? How well is bank lending going?

"There are lots of moving parts we have to keep a very close eye on."

Mr Cameron acknowledged there were "difficult" discussions going on ahead of the Comprehensive Spending Review, which will detail cuts totalling 83 billion over the coming four years.