Gordon Brown has said the government will remain committed to economic stability, but the Tories and Liberal Democrats have said they have better policies for business.

Speaking at the British Chambers of Commerce annual conference in London, the chancellor told business leaders that the global economy was undergoing a major transformation.

"The challenge to all of us is a global economy undergoing the most rapid and extensive transformation the world has ever seen - in pace of change, in scale of change, in the impact of change," he said.

"And the issue is not China and India as low-cost, mass producers while the advanced world prospers in high-tech value added goods.

"For on my visit to China I saw for myself an Asia moving forward in science-based, high-skilled, high value added production and services too.

"So for companies like yourselves, there is hardly a product or increasingly a service you produce that is not subject to global competition. 

"And no country, however successful today, can assume it will still be successful tomorrow.

"Countries, indeed continents, will prosper only if they adapt and change, but they will fall behind if they relax or are complacent.

"Quite simply, that the countries that will do best will be the countries that have the resolution, foresight and patriotic pride to make the long-term changes and investments to succeed."

Stability

Brown highlighted the government's record on fiscal stability, and said the decision to grant independence to the Bank of England had proven Labour's commitment to ending boom and bust.

"Let me promise you we will always be vigilant to the risks, not least to high oil prices and growing economic imbalances between the continents, but while this year's euroarea growth is expected to be just 1.5 per cent and Japanese growth less than one per cent, growth will be between three and three and a half per cent in Britain with, of the G7 countries, Britain and North America again growing fastest," he said.

The chancellor also pledged to reduce red tape and boost enterprise, with schools helping to provide the next generation of entrepreneurs.

He said his vision was of a Britain "that succeeds in the new global competition because working together we reject the old rigidities of the past and win as a flexible, reforming, and ever more enterprising economy".

European model

Also addressing the business organisation, Conservative leader Michael Howard said there was a "great irony" about the chancellor.

"When you hear Gordon Brown going on about the need to make the European economy more like America's, you might think he agreed with me," he said.

"The great irony is that he's actually making Britain's economy more and more like those of continental Europe. Europe should be a market for British business, not an economic model.

"The truth is that if you look at the major English-speaking economies, Britain is growing slower than any of them. And our income per head is now - for the first time - lower than Ireland's.

"We have dropped from fourth to eleventh in the world competitive league. I don't want the British economy to follow the European model. Labour, for all their fine words, do."

Red tape

Liberal Democrat Treasury spokesman Lord Newby said his party would "support business by setting it free" from red tape.

"People running businesses up and down the country are the powerhouse of the economy," he told the BCC.

"Liberal Democrats recognise that business needs the freedom to generate economic growth - yet they are held back, struggling under a mountain of government rules, tax complications, bureaucracy and inspection."

He added: "We will streamline the inspection regimes businesses face. We will simplify the tax system they struggle with.

"Liberal Democrats are also clear about the necessary role of government in upholding competition, encouraging corporate responsibility and environmental sustainability, and ensuring a reliable transport infrastructure.

"Liberal Democrats are instinctively a pro-business party.

"We believe the people who work in our businesses can stand toe-to-toe with the best in the world and deliver the prosperity this country depends on.

"We will set them free to do that. The Liberal Democrats are the real alternative for business."

Business support

As election campaigning continued, both Labour and the Conservatives also sought to prove that they had the support of business leaders.

On Monday the FT published a letter of support from some 63 senior business figures.

The letter congratulates the government for delivering "unprecedented" economic stability and growth.

But the Conservatives hit back by pointing to a survey of Forum of Private Business members which found 50 per cent back Michael Howard as prime minister.

"This is re-affirms what I hear from businesses both large and small from all parts of the country - that Conservatives are the real party of business," said shadow industry secretary Stephen O'Brien.