David Cameron has urged Europe to be "bolder" in pursuing a "pro-business" agenda to help pull the region away from economic catastrophe.
In a speech at the World Economic Forum in Davos, Switzerland, the prime minister said: "Tinkering here and there and hoping we’ll drift to a solution simply won’t cut it any more. This is a time for boldness not caution.
"Boldness in what we do nationally – and together as a continent."
In a broadside at his fellow leaders, the prime minister hit out proposals for a Europe-wide financial transaction tax saying it was "simply madness" to consider it while European economies struggled, and argued that the European central bank should "comprehensively stand behind the currency and financial system."
Cameron said that the UK wanted Europe to be a success and still believed that a single currency could work.
"We want Europe to succeed not just as an economic force. But also as a political force: as an association of countries with the political will, the values and the voice to make a difference in the world.
"When that political will is there, we can make a decisive difference," he said.
The prime minister also said that despite vetoing a treaty in December the UK was still a part of Europe "not by default but by choice."
"It fundamentally reflects our national interest to be part of the single market on our doorstep and we have no intention of walking away."
Acknowledging the UK's negative growth figures, published on Wednesday, the prime minister said: "Other large economies of Europe are forecast to have a similar outcome.
"In just four years government debt per EU citizen has risen by 4,500 euros. Foreign direct investment has fallen by around two-thirds."
The annual gathering comes amid renewed gloom about the economy after the International Monetary Fund this week downgraded its forecasts for global growth.
But Ed Miliband accused David Cameron of failing to take the right action: "Well yesterday we saw the British economy had gone into reverse. What David Cameron should be doing is taking action at home to get our economy moving, and working with other world leaders to get the global economy going too.
"But he's not doing that, he's standing by, he's stuck with the policy of collective austerity all around the world. It's not working, he needs to wake up and realise that, rather than being so complacent about what's happening in Britain."
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