Connect with us

Hi, what are you looking for?

Capital Business
Capital Business

World

EU united on finance but cracks elsewhere

BRUSSELS, October 17 – European Union leaders headed home from a summit that saw unity on fixing the global financial system but schisms when it came to an ambitious climate pact and repairing ties with Russia.

Two days before he flies to the United States for talks with President George W. Bush, French leader Nicolas Sarkozy, whose country holds the rotating EU presidency, was handed an EU mandate to press for a complete overhaul.

"We do not have the right to miss this opportunity for reconstructing our system of finance in the 21st century," Sarkozy said. "We have a mandate now to discuss this with the President of the United States."

The 27-nation EU, as a bloc the world\’s largest economy, endorsed a multi-billion-dollar initiative by the 15 members using the euro to rescue banks brought to their knees by the financial crisis.

But they went further, pressing for a root-and-branch reform of global finance they say is essential to drawing a line under the unregulated excesses of the past to prevent another crisis.

Sarkozy wants to get Bush on board ahead of a wider international summit including industrialised and emerging giants like India and China that he hopes will take place in November.

But if the summit saw a meeting of minds on the immediate challenge of the financial crisis, the leaders remained split over their response to other issues that have long been on the agenda.

In particular there was no standing shoulder-to-shoulder when it came to the bloc\’s wish to ink in December a bloc-wide deal on slashing greenhouse gases blamed for global warming.

Last year, EU leaders vowed to cut greenhouse gas emissions by 20 percent by 2020, compared to 1990 levels and pledged to have renewable energies make up 20 percent of all energy sources.

Advertisement. Scroll to continue reading.

But many EU nations have begun to baulk at the costs involved and the consequences to industry at a time when the financial crisis is threatening to push the global economy into recession.

Poland and Italy both threatened to veto to the pact but Sarkozy insisted that the EU remained on track to have the deal done and dusted at their next summit in December.

"I can confirm that the objectives remain the same, the calendar remains the same, now it\’s up to (us) to find solutions for those countries that expressed concerns," Sarkozy said.

"The climate package is so important that we cannot simply drop it, under the pretext of a financial crisis," he warned.

The EU\’s relations with Russia were also an area where leaders did not see eye to eye as it became clear that were not yet ready to resume talks on upgrading ties to reflect Russia\’s hydrocarbon superpower status.

The EU had suspended talks with Moscow in September on a so-called Partnership and Cooperation Agreement (PCA) after Russia\’s war with Georgia the previous month caused deep unease in EU capitals.

Instead, after a two-day summit in Brussels, the leaders put off making the decision and said they now aim to do so in time for an EU-Russia summit on November 14 in France.

France had hoped to announce the resumption of the talks at the Brussels meeting, an aim supported by Italy and Germany among others.

But several other EU members including Britain, Poland, the Czech Republic, Denmark, Baltic state Lithuania and Sweden have said it is too early.

Advertisement. Scroll to continue reading.

Polish President Lech Kaczynski, whose country blocked the partnership talks from starting in the first place because of a Russian embargo on Poland\’s meat exports, said a resumption would be "very risky and a victory for Russia."

Lurking in the background was also the EU\’s reforming Lisbon Treaty, rejected by Irish voters in a massive blow, with Irish Prime Minister Brian Cowen saying EU legal experts have now been drafted to help break the deadlock.

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...