“We like the UK. It is very open on its infrastructure sector,” he said, adding that Britain’s use of private capital to build public sector assets was a model for other developed economies to follow — particularly those struggling to recover from the effects of the 2008 and 2009 global financial crisis.
“Infrastructure investment can boost economic growth and employment and in fact it is fiscally neutral,” said Lou, a former Chinese vice minister of finance regarded by Beijing insiders as either a future finance minister, or central bank chief.
Lou said the balance between growth and fiscal rectitude was key to Europe’s ability to escape from a debt crisis that has dragged on for more than three years.
“Although people in Europe have agreed that they need a combination of growth and consolidation, in fact these two aspects are contradictory to each other and Europe hasn’t really thought out a way to move forward,” he said. “The risk of the eurozone falling apart has now dropped to less than 20 percent, but it is still there. To look on the bright side, now Europe has an agenda compared to a while ago when there was only babbling.”