Mandelson warns against nationalism

In a speech in Berlin, he will tell business leaders the answer to current troubles is not a retreat into nationalism but closer ties with the rest of the European Union.

He will say: "We have too often acted as if we have nothing to learn from the rest of Europe, or gain from closer European co-operation. After the crunch, that attitude is simply no longer credible."

Lord Mandelson, who was EU Trade Commissioner for four years, will add: "No matter how badly a downturn might tempt us to think and act in national silos, the next five years will in fact demand an even greater Europeanism from us.

"Eurosceptic gains in the European Parliament elections last weekend suggest a rising mood of national insularity, at least for some.

"But I believe our reaction to this crisis, if we get it right, can make Europe stronger for the future."

The Government's approach was underlined by Prime Minister Gordon Brown in an open letter to Mr Barroso.

"I firmly believe that Europe must not retreat in on itself, but instead improve its competitiveness through an integrated approach to single market and industrial policy," Mr Brown said.

"This approach must put the interests of businesses at its heart, with a real commitment by the next European Commission to focus future efforts on enforcing existing single market rules and reducing administrative burdens."