invasion in nato much more likely to be dealing with failed states, the capacities you need are different. we need a lot more cooperation, i think between the leading members of nato. and that's why we're work so closely with the french. we can deliver complimentary capabilities and get more done. >> the aim of achieving -- the imf made a recommendation that the u.k. banks slow up their acquisition, thereby producing more money available to british businesses and small businesses. does the government agree with that recommendation and will they work with the bank of england to implement it as soon as possible? >> i think the gentleman raises an important point. this is a difficult issue to get right. here we are rightly discussing two problems. one the need for growth. the other, the need for

financial stability and making sure you're safe with the head winds of a potential eurozone storm approaching. i think the best approach is to work hand in glove with the bank of england to get that balance right. that's what the government will do. >> i'd like to congratulate the prime minister on his stamina. he has done three summits in two days on two continents. can i reiterate the points made, we have to -- what we need, and it's essential that we have a review of nato's strategy with a full commitment by all its members. >> i'd like to thank my friends. that will be enough summits for

some time. the g-20 will soon catch up with us. what he says about nato is right. we need the reviews by all nato countries to go through their budgets to work out what is actually necessary for national defense, but what more we can all do to make sure nato has the capacities for the future. >> we need to spend more -- the nation of cyber terrorism which is posing an ever greater threat, can the prime minister assure us there will be the intense focus on resources given to that very big and growing problem acrossed world? >> well, i can certainly say for the u.k.'s part, one of the things we did in the strategic defense review, was from some of the savings we made. from memory, i think 900 million pounds into a cyber defense program. that's been coordinated with gchq and the private sector. it's the capability we hope to

work with ornate toe members to make sure we're sharing the best experience and endeavors, that should lead to savings. >> mr. speaker. the euro is dead -- it's no more, it ceased to be, it has expired. why did the euro continue to claim it is alive and well? isn't it essential that europe implements an oddly gray cup of the eurozone, before the markets force an economic tsunami? >> what i would say to my honorable friend, i've always been a genuine euro skeptic. that's why i didn't want to join p it we have to recognize what is in this country's interests. i believe that will involve a greater fiscal transfer, i think it must involve overtime euro bonds. it involves more active monetary

policy in europe. and we should be encouraging european partners to go down this road to ensure the system works properly. we have to be clear that although there are real dangers in terms of disorganize d exits it's not just the country that is would devalue. you have to think about the impact on financial institutions and banks around europe, including british banks. it's very important that the eurozone takes those zeps to put in place the contingency plans to keep them safe. >> now that he's lecturing greece about the need for growth, and we need a little bit in spain, and also in the eurozone, for the sake of clarity, can we get to the bottom of this growth here, repeat these words after me. i'm going to drop the austerity plan and go for growth in

britain. now's your chance. >> i'm afraid i don't agree. i don't agree with the honorable gentleman -- i deeply regret my last intervention with him was a bit more sharp than it should have been. i hope you accept my apology for that. he's a tremendous ornament to this house, sean always remains the case. i don't agree with him, because i think a deficit reduction plan is necessary and essential for growth. when this government came to power, our interest rates were the same as spains, ours are less than 2%, theirs 6%. one of the reasons for that, we have a credible fiscal policy. >> thank you, mr. speaker. could my friend give the house an absolute cast iron assurance that while he is prime minister, this country will never ever join the euro, unlike the position of the leader of the opposition who is open to the idea. >> i'm very happy to give that

pledge. i note the leader of the opposition said it depends how long he will be prime minister. i'm not sure which prospect is more terrifying. >> people see their friends suffering from a lack of opportunities, so they feel distressed when they huge unemployment rates for young people in greece and spain. will the prime minister say specifically what discussions he had with g8 colleagues about infrastructure development as a possible plan for growth. >> we did discuss the issue of infrastructure development, i think it can be part of what needs to be done. the rise unemployment is tragic in any country. when you look at the figures if greece and spain and elsewhere. they are eye watering figures, 50% of young people unable to find work. i think the elements of the plan we need the fiscal credibility that gives you the low interest rate. the active monetary policy that

supports demand in the economy, as it has done in the u.k., that needs to be combined with structural reforms and there is a need for proper structural reforms so they can have competitive economies. i think the extra llt is using the credibility that we've earned. the strength of the government's balance sheet to try to deliver innovative finance. that is obviously an option that is open in europe as well, and i think that's what president hollande is referring to. those are the elements of a growth plan, we got them in the u.k., we need them in europe as well. >> when we look at the scale and time scale, we get a sense of the awesome challenge that would face any german chance lower in trying to achieve fiscal union in europe. >> i think my honorable africaned is entirely right. this is why, when some people,

imply that german stubbornness is unreasonable. it's understandable. obviously, i think for the success of the eurozone, we need everyone to adopt the sorts of approaches i've been talking about. it is important to understand people's motivations and difficulties, because that is what lies behind the current impasse. >> chris bryant. >> it is good -- even leaving aside the elections in the russian federation, there are major human rights abuses in russia. for instance, kolikovski's second trial who has been condemned by many organization in the world and in russia. he tried to get an appeal for that, it was turned down only last week, by judge alexander verano. he's a military judge. when the decision was handed

down there could be no appeal, it was done on the russian armed forces website. doesn't this show that russia has a great distance to go yet before it can really embrace being a part of the humanitarian nations? >> we discuss regularly with russian colleagues the importance of freedom and human rights and democracy. when i met with russia, i discussed precisely those issues. i think it is worth with while having russia in the g8. when with we are discussing issues like iran and syria, where russia has an interest and we want them to join in in the efforts that we're pursuing, i think it's helpful to have them there. >> thank you, mr. speaker. >> in the absence of progress toward a global trade, the eu deal could be a decent second best if it reduces its tariff

barriers to trade and how much the european community will benefit from it? >> i think there is something salvageable, which is helping reduce customs times, charges and the rest of it bs rather than the bigger package. i think we should pursue that. in terms of the eu/u.s. potential deal, we had a conversation at the end of the g8 where we agreed to look at the issues paper for the g20 whether there was a small enough distance between the eu and u.s. to close that would make a deal worthwhile. i'm hopeful, britain is one of the most open trading nations. there are real concerns on both sides. you have a french position on agriculture, and i think we have a good look at it in the g20 and see whether we can fast track it. >> is the prime minister aware

that greece spends 50% more on defense than ourselves, france or turkey. it is the biggest arms importer in europe. the greek shipping industry doesn't pay a penny in tax. the greek orthodoxed church doesn't pay a penny in tamm. can we ask him to descale defense spending? the orthodoxed church to pay a little bit to solve the greek crisis. >> i think the auto general makes a good point, which is it, however much one can look at the greek situation and feel for the suffering people have in terms of unemployment and living standards, there is a crying need for genuine reform in greece and for a more straight forward and honest politics of dealing with the problems. making sure people do pay their taxes and industries are competitive. the issue is obviously more

complex because of the relationship between greece and turkey. there should be an opportunity to decrease greek spending on national defense in that way. but encouraging it to be a member of the eu at the same time. >> did any of the leaders make the argument that dealing with the deficit and supporting growth are alternatives? or did they argue that you need to support growth through monetary policy, supporting the banks, getting trade going? and was there anybody who made the argument that you need to borrow your way with out of debt? >> he makes an important point. there was no one suggesting somehow dealing with deficits and -- that is the view of everybody around the g8 25ib8. there's only one with group of people that have their head in the sand or a complete deficit

denial, that's the people that gave us the deficit in the first place. >> i would like to turn your attention to youth unemployment and the economy set to contract by a further 6% in the current financial year. he has preached austerity, that's what's been done in greece and that's the result of it. is he prepared to put pressure on the european central bank as far as he can, to stop the austerity oppression on greece and start supporting the needs of very ordinary people who work very hard and don't deserve this misery? >> where i part company, we very consistently said you need to have deficit reduction that delivers you the low interest rates, and enables your central bank to pursue an active monetary policy, which is what we've had in this country. and at the same time, you need

the structural reforms to make sure your businesses are competitive and they can take on more people and grow. that is what we're seeing in britain with 600,000 more private sector jobs. that is a world away from what is happening in greece or many other parts of the eurozone, they haven't undertaken the structural reforms we have in this country. >> thank you very much, mr. speaker. the biggest threat to our country at the moment is the crisis in the eurozone. almost parallel to that is the pending crisis if the middle east. with a start that today's very important conference in baghdad did we find time over the weekend to speak to the russian and chinese leaders to emphasize the importance of anywhere goal to make sure we have a peaceful outcome of the situation? >> a good portion of the g8 was spent discussing the situation in iran, and specifically talking about the talks that are

underway in baghdad today. it was the russians who signed up in terms of a tough text. europe has rightly adopted these oil sanctions, the pressure is beginning to tell on the iranian economy. this is the moment to pressure other countries aaron the world to join in on these sanctions and to say with the iranians there is another pathway. you have to give up the ambition of enriching uranium to the extent it could deliver you a nuclear weapon. >> whatever structural deficiency and other problems, the problem is not caused by that. it's caused by a banking and economic crisis in the world. now, the suffering and austerity that's taking place in greece is on a completely different scale.

it's untenable for that to continue. the problem is not to look at the germans and say, what can we do? remind the prime minister greece is a very proud nation. they're a very important ally of ours, they stood by us. we should do what we can to help them. >> of course i agree. i don't agree with him, that the problems in greece are only caused by the euro or by the banking crisis. there are deep and profound problems in the economy that need to be dealt with. i think -- as i've said the right combination is, you need to have the deaf significance reduction plans. you need to have an active monetary policy, and you need structural reforms. in the end, it's going to be for the greek people to decide whether they want to do these things inside or outside the

euro. clearly a disorderly exit would be bad for britain, and we should do everything we can to avoid that. we need to plan for every eventuality and have proper contingencies in place. >> in the absence of much needed supply reforms in the eurozone, i suggest the day of reckoning is fast approaching. in the vast majority of those cases, the countries have benefited. does the prime minister think we are fast approaching the time where we should stop talking about the need to save the euro, because this can create uncertainty and hit confidence and investment in this country? >> you make an important point. i'm not entirely sure i agree. have you examples of countries that have left currency pegs and suffered in the short term, but then recovered. also, you've had countries like

czechoslovakia. i think there is a substantial difference when you have a currency zone with a single currency, and you have a potential breakaway from that. i think it's a different situation because the banks are so intertwined. that's why we have to think very carefully about it in terms of the con sing enscy plans. >> jim mcgov earn. >> thank you, mr. speaker. >> very recently my wife with and i welcomed an italian home to dundee. could the prime minister assure me and personnel, my family and constituents that on his watch there will always be a black watch. >> i want us to keep the regimental structure we have. i think it is important. obviously, though, at the same

time, we need to deliver this big change in our armed forces, which is going to deliver a larger army, but a better balance between a professional army and territorial army. we're looking at how that can be done while saving the important regiments that people write. >> mary mccloud? >> after the g8 summit, the uplifting 50 million people from poverty in the next 10 years, could i urge the prime minister to do even more financing as a way of creating long term sustainable economies, and to use charges like the foundation in chisolk, that gets a 99% return on the money it gives to women in africa. >> i think you make a very important point. we have committed to aide and development, we're committed to expanding this program that barack obama launched in terms of the new lines for food

security. i think the point about micro finance is important because this not only helps to grow small businesses, it also means empowering women, which can make an enormous difference to the success of the development. >> was there any discussion about the situation? on monday in the middle of unity day celebrations, killing six. this morn thanksgiving said half the population are going to starve to death. i appreciate what the prime minister and british government have done, indeed successive governments. in making a priority, and i acknowledge your champing the cause of burma for his chairmanship of the g8, can he not find a little space for yemen? a stable yemen is in our interests. if we don't support this country, al qaeda will take it over, and it will bleed to death. >> the gentlemen knows i agree absolutely with him about this. and my contribution in the g8

talking about the next g8, as it is very important we look to the security and development priorities of the future. and i think yemen and somalia are both squarely in that bracket. in yemen it was extremely distressing what happened in terms of that absolutely hideous bomb attack and the loss of life. i think we have to focus a huge amount of effort. there is a development effort that is going in with i think 26 million pounds being announced by terms of investment in that country there is also an enormous amount of security assistance we need to give that country. >> andrew stevenson? >> speaker, can i echo what the prime minister said about our brave servicemen and women who continue to strive to bring peace and stability to afghanistan. sadly, agreement wasn't reached on reopening the supply routes through pakistan. so i'm wondering if the prime minister can comment more on this and the role of pakistan as a key ally in leaving afghanistan on a stable footing at the end of 2014. >> i think this is a key point.

obviously we need to make sure that we have northern routes as well. and i had a good meeting with the president of azerbaijan to discuss that issue. in terms of pakistan, of course all members are absolutely entitled to feel frustrated. we're enormous aid donors to pakistan. we have a strong relationship with that country. and it is frustrating that the lines of control are still closed. but as i say, i think we're ongoing discussions are under way, i'm confident they will be reopened. and we do have to show an understanding about how this country suffered from terrorism about the complexities of its politics and the need to show real respect for its sovereignty. and the message we have to give afghanistan and pakistan is long after this war is over, we are there supporting both of you as strong independent countries, diplomatically, politically, through trade, through aid, through all the means that we have, and that we will not desert them. >> meg hillier.

>> mr. speaker, a recent visit to nigeria, i saw first half the opportunity for agri investment in that amazing country. but group which i chair has heard a lot from british businesses about the logistical and security concerns about investment in nigeria. while it is a good step, what support will the prime minister pledge to british companies looking to invest so that we get a win-win for both growth in british business and food and jobs for nigerians? >> first of all, when i went to nigeria and met the ukti team in lagos, i was hugely impressed by their work, their dedication and the incredible links there are between british nigerians and nigerian british as it were working between the two countries. we work very closely with the government in terms of security because there are real challenges, particularly in the north of the country. and i think it's one of the areas where security training and counterterrorism cooperation between our country and nigeria can really help some major

dividends for that country, but also for trade investment as well. >> mr. sharma. >> thank you, mr. speaker. given the increasing exports, the emerging economy needs to be a part of the key strategy of the g8 nations, can the prime minister interrupt the house with any discussions he may have had with other european leaders on progress of the pending free trade agreement between the eu and india? >> we had a number of discussions about these free trade agreements because obviously there are a series of ones. the indian one, the canadian one, the chance of getting one going with japan. my view is all of these are good news. the korean one has been a success, and we need to drive them all forward, and we're certainly in the vanguard of doing that. >> can i join with those colleagues who have expressed concern at the scale of the cuts being forced on greece, the ordinary people of greece, not the greek government. can i suggest to the prime

minister, one, i agree with him. there needs to be structure reform which we have indicated. wouldn't it be better to have a bit more flexibility, a bit more european solidarity than end up forcing greece in a situation that ends up collapsing that country, but indeed immense consequences for eurozone and the entire world economy. >> obviously, we're not a participant in the eurozone bailout of greece. we are supporting greece through the imf. i think the point that he has to consider is that other european countries and eurozone countries, some of whom are not particularly rich themselves have had a series of agreements with greece about what needs to be done and what money will be put in. and effectively, he is asking them to go back repeatedly to their own parliaments and i said i wouldn't ask for any more for greece, but here i am again asking for more. so it is very, very challenging for them. this i say in the end is going to be a matter for the greek people to decide through their election about whether they want to stay in the euro and keep the

undertakings that they have given, or whether they want to choose a different path. it's for them to decide. we must be clear in this country that we should support all and any contingency plans to make sure that either scenario can be safely delivered. >> mr. robin walker. >> the prime minister in his statement quoted the extraordinary statistic that the eu and the u.s. together make up more than half the world's gdp. will he accept that this may be the last generation that this is the case, and it is more vital than ever that we reach out further and faster into developing markets to support our exporters, build on our strength as a country? >> i think my honorable friend is right. the share of trade and economy taken by the eu and north america together is likely to decline as china and india rise. i was always taught in business, going back to your best and biggest customer to get that extra deal is often a very good strategy. so we should be thinking exactly by that in terms of eu/u.s. trade. >> mr. hugh bailey. >> at a time when the

defendant's budgets is constrained across the alliance, is it not important for nato itself in the same way as nato's member states to demonstrate that every pound they spend is well spent? and will the uk therefore support proposals being considered by the nato secretariat to insure that the external audit is independent of nato? and that they're available for polltarians in this government and others to scrutinize in the same way we scrutinize our own defense expenditures? >> my friend has great knowledge of these things i think makes a series of sensible suggestions. and i think we should look carefully at them. let me commend secretary general rasmussen for what he has done in terms of reforming the huge number of command posts and headquarterses posted on nato. i suspect there is more to be

done on that as well. >> currently 3% of the european market in services. can the prime minister confirm just how important completing the services market is for british services? >> well, i think the point i make to my honorable friend is completing the single markets in digital and energy, each can add i believe over a percentage point on european gdp. the services market is particularly important because it is an area that britain excels at in terms of not just financial services, but everything from construction and architecture and what have you. so opening up services in other countries, and there are a number of countries that are currently in breach of their undertakes, and so the pressure of this, particularly in countries like germany, should be very great. >> the right davis. >> yes, mr. speaker, on greece we all know the expression give a man a fish and he can eat for a day. give him a rod and he can eat for life. so why in greece isn't some of the money used to pay down the debt instead invested in solar forests across greece so they

can bring energy to europe. in rail links so we can boost tourism, in universal broad band so we can connect up greece to the rest of the world. so we have a politically acceptable and economically sustainable solution instead of putting half the fish on the table so hungry and angry by lunch time? >> the point i make to the honorable gentlemen is first of all, the greeks have had a very special deal in terms of an enormous private sector haircut on their debt that has actually asked creditors to take a share of the burden. and also, if you take the last decade and look at the money that greece has received from the european union, that is money that could have gone into many of the projects that he points out. part of the problem in parts of the eurozone is that the early years of the euro was used to see wage rates and unit costs of labor rise rather than actually making the fundamental changes to make these countries -- make these countries more competitive.