Dhe tremors caused by President Putin’s attack on Ukraine and the aftermath of Covid are making themselves felt in economies around the world. High inflation and slowing growth are problems the UK shares with many countries across Europe, including Germany.
Our two countries are also united by a firm commitment to fiscal responsibility, a willingness to tackle our problems head-on, and a desire to act together to enable economic growth while reducing inflation.
Eurozone inflation is at a record high of 10.6 percent. The rate in the UK is 11.1 percent, in Germany 11.6 percent. That means we’re all paying more for everyday goods and commodities than we were a few months ago. But it’s not just households that are struggling – these are tough times for companies too. The rising costs of energy, goods and materials are squeezing profit margins and making it difficult for employers to create new jobs.
Economic stability urgently needed
I’ve been honest with the people of the UK and Northern Ireland that inflation is the big enemy to contend with – and the same goes for countries across Europe. The autumn declaration that I have now made in the UK Parliament is about exactly that: managing inflation and improving people’s lives while bringing much-needed stability to the UK economy.
Raising taxes and cutting government spending was a difficult decision, but it will stabilize our economy and provide security for financial markets. In addition, we will ensure that those most in need receive support during this difficult winter.
We are a country that is not afraid to make tough decisions to lay the foundations for an economy that will thrive and prosper in the years and decades to come.
Defy the attacker
I know that Germany is also committed to a sustainable public finance policy. Our shared belief in financial discipline will guide us as we tackle today’s challenges. Furthermore, we will ensure that we will be in the best possible position to respond to future economic challenges.
Putin’s war of aggression against Ukraine and the use of energy as a weapon are the main causes of rising inflation and a bleak economic outlook. Federal Finance Minister Christian Lindner and I will stand up to our common aggressor by making critical decisions to reduce debt, lower inflation and create economic stability at a time when it is most needed.
Germany and the UK are navigating together these troubled waters that lie ahead, and this will no doubt strengthen our bonds of friendship and our economies. We will always be indispensable partners when it comes to tackling global challenges together.
Jeremy Hunt is the British Chancellor of the Exchequer.
