The German government believes Britain should be part of a Europe-wide tax on financial transactions, the proceeds of which could help prop up the single currency. However, David Cameron and George Osborne have blocked the tax, with the Chancellor claiming it is a “bullet aimed at the heart of London”. Ministers have instead called on the Germans to allow the European Central Bank (ECB) effectively to print money to rescue beleaguered economies. The Prime Minister will travel to Berlin on Friday for what are expected to be tense negotiations with Angela Merkel, the German chancellor, over the crisis. A senior figure in the party headed by Mrs Merkel attacked Britain as relations between the two countries deteriorated in the wake of the single currency crisis. Tensions between Germany and Britain over how to handle the crisis in the eurozone deepened after allies of the German chancellor, Angela Merkel, claimed she would not allow the UK to "get away" with its refusal to back a European financial transactions tax. Speaking before a meeting between Merkel and David Cameron on Friday, the parliamentary leader of her Christian Democratic Union said: "Britain had a responsibility to make Europe a success." Volker Kauder, at the CDU conference in Leipzig, said: "I can understand that the British don't want that [a transactions tax] when they generate almost 30% of their gross domestic product from financial-market business in the City of London. Only going after their own benefit and refusing to contribute is not the message we're letting the British get away with."
Access Investments-Building Awareness - European Union-ROMANIA
Wednesday, November 16, 2011
Angela Merkel will not "allow" UK "to get away" with refusal to back financial transactions tax
The German government believes Britain should be part of a Europe-wide tax on financial transactions, the proceeds of which could help prop up the single currency. However, David Cameron and George Osborne have blocked the tax, with the Chancellor claiming it is a “bullet aimed at the heart of London”. Ministers have instead called on the Germans to allow the European Central Bank (ECB) effectively to print money to rescue beleaguered economies. The Prime Minister will travel to Berlin on Friday for what are expected to be tense negotiations with Angela Merkel, the German chancellor, over the crisis. A senior figure in the party headed by Mrs Merkel attacked Britain as relations between the two countries deteriorated in the wake of the single currency crisis. Tensions between Germany and Britain over how to handle the crisis in the eurozone deepened after allies of the German chancellor, Angela Merkel, claimed she would not allow the UK to "get away" with its refusal to back a European financial transactions tax. Speaking before a meeting between Merkel and David Cameron on Friday, the parliamentary leader of her Christian Democratic Union said: "Britain had a responsibility to make Europe a success." Volker Kauder, at the CDU conference in Leipzig, said: "I can understand that the British don't want that [a transactions tax] when they generate almost 30% of their gross domestic product from financial-market business in the City of London. Only going after their own benefit and refusing to contribute is not the message we're letting the British get away with."
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Alan Krueger, chairman of the White House Council, said the “Europeans” must urgently address the problem, in another indication that the Americans are unlikely to provide money for an international bailout. “The sovereign debt issues in Europe, the banking issues in Europe, are at the top of everybody’s list of identifiable threats,” he said.
Lawrence Summers, the former US Treasury secretary, said the rescue package approved by European leaders last month “was manifestly inadequate at the time it was reached”.
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