Europe Business Leaders: Need Large, Rapid Interest Rate Cuts

LONDON --European businesses don't need subsidies or aid, but they do need governments and central banks to boost demand through interest rate and tax cuts, a group of 47 leading European companies said Monday.

Meeting in Istanbul, leaders from the 47 companies that are members of the European Round Table of Industrialists said they feel "grave concern" over the outlook for the global economy.

"We see economic conditions deteriorating rapidly in most of our industries, and we consequently see the urgent need for further coordinated political action," said Jorma Ollila, chairman of the ERT and chairman of Nokia Corp. (NOK).

But the ERT said it doesn't want governments to give subsidies to ailing sectors or companies. Instead, it called for central banks to cut key interest rates "rapidly and in large steps," and called on governments to cut income taxes, and increase spending on infrastructure, combating climate change, education and research and development.

"We urge them to take further measures to stimulate demand by adequate fiscal policies, improving the availability of credit, and to strongly resist any moves towards protectionism," said Ollila.

-Paul Hannon, Dow Jones Newswires, +44 20 7842 9491, paul.hannon@dwojones.com