'Britain will beat off threat of recession'

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LONDON, June 19 (AFP): Finance Minister Alistair Darling warned that "times are tough" but insisted Britain would stave off the threat of recession, in a keynote speech yesterday.

Chancellor of the Exchequer Darling renewed calls for pay restraint in both the public and private sectors to stop the economy heading into an inflationary spiral.

He confirmed plans to strengthen regulation of financial services, in his debut turn at the chancellor's annual state-of-the-economy speech to business leaders at the Mansion House in central London.

"Times are tough. It will take time for these global difficulties to work through," Darling told city financiers.

"But our economy will continue to grow.

"Independent forecasters expect UK inflation to fall back next year. Employment is at a record high. Many order books are full. British business is competing and winning all over the world. Our economy is flexible and resilient.