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Thursday, 2 August, 2001, 19:36 GMT 20:36 UK
Blair warns EU on economic 'disaster'
Tony Blair and Cherie Blair with the Mexican president and his wife
The Blairs with the Mexican president and his wife
UK Prime Minister Tony Blair has again used his trip to Latin America as a platform to push for greater economic reform in the EU.

Speaking in Mexico City on the final leg of his tour of the region, Mr Blair said it was vital the EU did not retreat behind trade barriers and create a "fortress Europe".

UK's Latin American trade
Argentina: 400m
Brazil: 1.9bn
Mexico: 1.3bn
On his tour of Mexico, Brazil and Argentina, Mr Blair has been keen to line the three countries up in support of his agenda of further trade globalisation.

Speaking a day before he begins a family holiday in Cancun, Mr Blair said it would be a "disaster" if the EU failed to reform the controversial Common Agricultural Policy and free up markets.

The prime minister made his remarks after holding talks with Mexican President Vicente Fox.

The two leaders have agreed that a working group will be set up to develop trade relations between the two nations.

Fortress Europe

Speaking to the media the prime minister warned his European colleagues of what he believes are the dangers of protectionism.

"It would in my view be a disaster for Europe if we ended up with a fortress Europe," he said.

"Europe has got to be competitive not just within Europe but with the rest of the world and that does mean fundamental change in areas like agriculture and liberalising energy and other markets."

The prime minister and a delegation of 12 business leaders are expected to visit oil and gas installations in the Gulf of Mexico.

Cherie Blair
Cherie Blair was greeted by Mexican schoolchildren

Earlier Mr Blair and his wife Cherie were greeted at the National Palace by a guard of honour and flag-waving children where they met the president and his new wife, Martha.

After the official business of the state visit is complete the Blairs and their four children will begin a family holiday.

Downing Street has insisted that the family will not pose for the media during their break.

On Wednesday Mr Blair became the first serving British prime minister to visit Argentina since the 1982 conflict over the Falkland Islands.

During that historic visit Mr Blair said he hoped the two countries could put behind them the differences that led to the conflict over the islands.

Debt fears

Mr Blair met for talks with President Fernando de la Rua, who ruled out another military invasion of the Falkland Islands, known in Argentina as the Malvinas.

The president told a news conference: "We have said that our claims over the Malvinas islands are absolutely along peaceful paths."

Mr Blair and Mr de la Rua also focused on economic matters.

Their meeting came amid fears that Argentina could be forced to default on its $128bn debts.

This could trigger a financial crisis in Latin America which could spread to the rest of the world.

Mr Blair said it was important that other countries reward Argentina for the measures it was taking to fight its economic crisis.

The BBC's Mark Mardell reports from Mexico City
"Tony Blair got the full red carpet treatment"
See also:

01 Aug 01 | UK Politics
On tour with the Blairs
31 Jul 01 | UK Politics
Green protesters challenge Blair
31 Jul 01 | UK Politics
Blair presses EU to change
29 Jul 01 | Business
Blair's Brazilian business trip
30 Jul 01 | World
Argentina crisis plan approved
19 Jul 01 | UK Politics
Blairs pay for holiday flights
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