London (dpa) - British Finance Minister George Osborne defended
the government's handling of Britain's debt and deficit problems on
Saturday, a day after Moody's ratings agency downgraded the country's
credit citing "subdued" growth prospects and mounting debt.
"The test of our credibility as a country is there every day in
the markets when we borrow money on behalf of this country from
investors all around the world," said the chancellor of the
exchequer.
"At the moment, we can do that very cheaply with very low interest
rates precisely because people have confidence that we have got a
plan" to address Britain's economic concerns, Osborne said.
Since the beginning of the financial crisis in 2008, Britain has
seen its debt grow to an estimated 86 per cent of its gross domestic
product (GDP).
Moody's on Friday lowered Britain's top AAA credit rating to AA1 -
the first time the country had been stripped of the top rating - a
blow to Osborne, who had pledged to protect the status while
implementing the conservative government's austerity measures.
Prime Minister David Cameron, who took office in 2010, has tried
to get the country's debt under control by drastically cutting the
budget. So far, that has not yielded results.
"I don't think anyone looking at what this government has done
over the last couple of years would say we've run away from those
problems, (say) we haven't taken the difficult decisions," Osborne
said.
Britain's budget deficit is expected to grow by nearly 7 per cent
this year, according to experts. The country is heading towards its
third recession in four years as GDP growth shrinks.
The pound also has lost value in the last several months against
the euro and the dollar. Britain's central bank recently admitted
that inflation would not be 2 per cent as projected, rather more like
3 per cent.
