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Lord Mandelson on why the London Summit matters for business

In an interview with entrepreneur Theo Paphitis on Yoosk - the interactive interview magazine - Britain's Business and Enterprise Secretary spells out the importance of coordinated action to deal with the global crisis and avert the threats facing small and medium-sized enterprises.

Mr Paphitis, a serial entrepreneur and one of the investors on the BBC-TV Dragons' Den series, started the interview by asking Lord Mandelson what the European Union could do to keep the UK and other European countries get out of the economic recession. The Business Secretary – a former EU Trade Commissioner – says the priority is to keep the European single market open and avoid erecting protectionist measures to trade between members states:

Next, Mr Paphitis asks why the banks aren't just allowed to go bust – instead of being bailed out with taxpayers' money. Lord Mandelson says that functioning banks are essential for the smooth operation of the economy – for savers, for house-buyers and for businesses. He expects to see a healthy return for the taxpayer when the banks are back on their feet.

With all the emphasis ahead of the London Summit on the need for a low carbon recovery, Mr Paphitis asks Lord Mandelson what this means. The Business Secretary says there is no future in a high carbon recovery, and that businesses need to work out how they can produce goods and services for the new low carbon economy. It is also important for businesses to analyse how much energy they use and curb their emissions – saving costs and improving their competitiveness.

Towards the end of his interview, Mr Paphitis asks the Business Secretary why it would be wrong not to protect domestic businesses. Lord Mandelson says protectionism would initiate a round of 'tit for tat' measures that would reduce economic growth all round. The challenge is to adapt to the globalised economy to take advantage of new and growing markets – something that requires open trade. To allow for such changes, governments must help people adapt to such challenges.

Lord Mandelson concludes that the London Summit will be an opportunity to underpin the international financial system with standards, conditions and guarantees – bringing together what he describes as 'the steering committee' of the global economy.

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