Tuesday, October 21, 2008

Spain left out of Sarkozy's international economic crisis summit

Sarkozy plans to leave out Spain at next international summit meeting on world financial crisis

The French president, Nicolas Sarkozy, said today that the members of the G8 together with the G5 which includes the principal emerging economies (Mexico, Brazil, China, India, and South Africa) should meet at the next international summit meeting to discuss the international financial crisis. However, this announcement leaves out Spain which is not included in the list of invited countries.

After the decision of the French President became public a spokesperson for the Spanish government said that diplomatic discussions were in process in order to guarantee Spain a place at the planned summit. The Spanish government believes that it should be present at the meeting because Spain is the 8th world power and it is the biggest investor abroad after the US and France as well as the fact that two of Spain’s Banks are amongst the 16 largest in the world Furthermore, Spain is an important EU member state and is very influential in Latin America.

When questioned by reporters, the Spanish president, José Luis Rodríguez Zapatero, said that he would look into the French President’s decision although Pedro Solbes, the Minister for the Economy did not think that it was of any importance because Spain does not usually participate in G8 meetings.

In an appearance in the European Parliament Sarkozy said that he was in favour of holding a preparatory meeting with EU member states and said that the easiest option would be to link the summit to that of the G8 that brings together Russia and the 7 most industrialized economies in the world.

The French President repeated that following the emergency measures to deal with the international financial crisis which today received the backing of the International Monetary Fund the moment had arrived to outline the ‘true answers’ in order to avoid similar problems in the future. In addition, Sarkozy took advantage of his appearance in the European parliament to defend the creation of a clearly identifiable economic government in the Euro zone. This proposal encompasses the idea that EU member states create their own sovereign funds and coordinate them together to avoid EU companies from falling into foreign hands.

Sarkozy added that EU countries should reflect on the opportunity to create their own funds so that these national funds could be coordinated to help bring a solution to the current crisis.

On this point Sarkozy referred to the low interest loan of 25,000 million dollars (just under 19,000 million euros) that the US administration intended to give to the US car industry to prevent it from going into bankruptcy. He said that the European car industry could find itself in a seriously distorted situation with regards to its competitiveness compared to its American rivals.

Sarkozy said that this did not question the single market or the policy of competition or the limits on public help. He said that it meant that Europe should look for a united answer which should take into account competition from other regions in the world. He said that it was the duty of EU governments to ensure that Europe continued to produce planes, ships, trains and cars because Europe needed a strong industrial base.

The French President insisted that the economic crisis was already here and said that Europe should face up to it with a united answer similar to that which it had been achieved in the face of the international financial crisis, although he admitted that disagreements amongst member states did exist. He said that unity did not mean that the answer was the same for everybody. He repeated his idea that there was a need for an economic policy which meant that EU members should discuss matters and most importantly in some situations coordinate their actions.

Update
This evening Zapatero held a news conference in which he said that he and the French President had spoken by phone this afternoon and that during the conversation Sarkozy had assured him that the presence of Spain in the international summit was "convenient". Gordon Brown gave his backing to Zapatero last week when he said that the presence of Spain was desirable given the fact that the Spanish government had made some "interesting suggestions" about possible policies aimed at tackling the economic crisis
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posted by Euroresidentes at 9:01 AM

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