Europeans Chiefs Propose Global Rules

European leaders mounted a united front against the global financial crisis yesterday, proposing sweeping new market regulations, but it remained unclear whether economic giants like the United States and China would go along.

Heads of government and finance ministers from Europe’s largest economies joined German Chancellor Angela Merkel in Berlin to lay the groundwork for a common European position on economic reforms before an April 2 summit of the Group of 20 nations in London.

“Europe will own up to its responsibility in the world,” Merkel said.

Leaders from Britain, France, Germany, Italy, Luxembourg, Spain, the Netherlands and the Czech Republic agreed to press for sanctions on tax havens, caps for managers’ bonus payments and a stronger role and increased funding for the International Monetary Fund. While the plans were based on an agenda adopted by the G-20 in November, the measures announced yesterday were more far-reaching and concrete, particularly on long-disputed issues such as hedge fund regulation.

However analysts say other G-20 members, including the US, China, Japan and nations like India and Brazil, might not share Europe’s zeal for blanket global regulations.

During Germany’s turn at the presidency of the Group of Eight two years ago, Merkel pushed hard for more transparency on financial markets and, especially, hedge fund regulation. But her efforts ran into resistance from Washington and London. Even the global crisis and a change of Administration may not be enough to convince the US to hand over its autonomy.

“I see the US as wary of giving away powers of oversight and regulation,” said Robert Brusca of Fact And Opinion Economics in New York.

Financial industry leaders, on the other hand, might have lost too much credibility to fight off heavy restrictions on their practices.

“What the industry thinks is irrelevant,” Brusca said. “It has squandered any goodwill it had by being given a leash of self regulation – then running amok.”

Source: nzherald.co.nz

Advertisements

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: