Gordon Brown, the UK chancellor of the exchequer, on Wednesday night fleshed out the central argument for European economic reform that Britain wants to make in its six-month EU presidency, calling for a new mood of "pro-European realism" in policymaking across the continent.

In an annual speech to the City of London, the chancellor put the promotion of European economic reform at the centre of his address. He also said the pooling of sovereignty in EU institutions must be maintained - but that it must be accompanied by a hard-headed recognition of the challenges from the growing Chinese and Indian economies.