EU leaders agree on financial reform


Brussels : European Union (EU) leaders agreed Friday to a common position on reforming the global financial system, officials at an emergency EU summit in Brussels said.

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“There is a pretty detailed common position from Europe,” said French President Nicolas Sarkozy.

At the summit, which was intended to prepare a common EU position for a meeting of the world’s leading economic powers in Washington on Nov 15, EU leaders gave their backing to a watered-down set of principles drawn up by the French government, which currently holds the EU’s rotating presidency.

Europe’s four main demands are stricter regulation of financial markets, more responsible and transparent management, better crisis prediction and prevention, and a reinforcement of major international institutions such as the International Monetary Fund.

But following strong protests from some member states, EU leaders softened a key French call for all financial institutions around the world to be regulated.

The revised text approved by national leaders runs, “no financial institution, no market segment and no jurisdiction must escape proportionate and adequate regulation, or at least oversight.”

Leaders also struck out two statements referring to an earlier, and far more detailed, French document as the foundation for future talks, arguing that it was too detailed to be acceptable.

“There is a risk that we over-regulate and that we are too quick in our response. That’s why I say fewer but more effective regulations, and take the time to analyse to go through what is needed to be done,” Swedish Prime Minister Fredrik Reinfeldt, who emerged as one of the main critics of the French text, said.

Sarkozy is now set to travel to Washington on Nov 15 to represent the EU in his capacity as holder of its presidency. The leaders of Britain, Germany and Italy are also set to attend the summit as permanent members of the so-called Group of 20.

The Czech Republic is due to send an official in its capacity as the next holder of the EU presidency. Spain and the Netherlands are lobbying for an invitation.