Brown backs Europe to lead world out of economic nightmare

The European Union can lead the world out of recession by forging a new partnership with the US President, Barack Obama, Gordon Brown declared yesterday.

In the most pro-European speech he has ever made, the Prime Minister cast aside his doubts about the EU as he mapped out the "new consensus" on the global economy which he hopes will be agreed at the G20 summit of leading economies in London next week.

Addressing the European Parliament in Strasbourg for the first time, Mr Brown took a sideswipe at the French President, Nicolas Sarkozy, who has been accused of taking protectionist measures to safeguard jobs after Renault switched some production from Slovenia to France.

Mr Brown described protectionism as "the road to ruin" and said the G20 leaders must resist the temptation to "try to feel safe by attempting to pull up the drawbridge or turn the clock back". He is privately worried that some EU governments may resort to "covert protectionism" by helping one sector, such as the car industry.

The Prime Minister hit back at criticism by Stephen Byers, the Blairite former cabinet minister, that his agenda for the G20 summit was "too ambitious" and likely to produce "high-minded declarations and vague reassurances that appear largely irrelevant to the concerns of the average voter". Writing on the website of Progress, a group of Labour modernisers, Mr Byers said the temporary VAT cut had "run its course" and should be scrapped.

Defending his approach to the G20 meeting, Mr Brown replied sharply: "It is better to aim too high and fall short than to aim too low and succeed." He admitted that some pro-Europeans saw him as a sceptic who supported global action more than European action. But he told MEPs: "I stand here today proud to be British and proud to be European, representing a country that does not see itself as an island adrift from Europe but a country at the centre of Europe, not in Europe's slipstream but firmly in its mainstream."

Mr Brown accepted that plans for a European financial regulator formed part of an emerging consensus on how to combat what he called "an international hurricane sweeping the world".

Proposing a "new era of heightened co-operation" with America, he said the annual EU-US summit should now be turned into "an unstoppable progressive partnership to secure the global change the world needs".

Mr Brown, on the first leg of a 17,600-mile international tour ahead of the London summit, had a 25-minute telephone conversation with President Obama as he continued his drive to broker a G20 deal. They also discussed Iran, Afghanistan and Pakistan.

Mr Brown argued that the EU was "uniquely placed" to lead the drive to turn today's "unsustainable, insure and unequal" society into a truly global one that was sustainable, secure and fair for all, and spoke of "one Europe". But Joseph Daul,the leader of the centre-right European People's Party in the parliament, said it was not enough for Mr Brown to condemn protectionism abroad. He said he should also avoid, at home, advancing slogans such as "British jobs for British workers".