Capitalism must be regulated, says Sarkozy
24.09.08 @ 09:16
French president Nicolas Sarkozy, whose country currently holds the rotating EU presidency, on Tuesday (23 September) called for an international summit to tackle the global finance crisis and its consequences, saying that capitalism should be more "regulated" and less "opaque."
"Let us build a capitalism where ratings agencies will be subject to controls and punished when necessary, where transparency of transactions will replace opaqueness. The opaqueness is such today that we have difficulty understanding even what is happening," Mr Sarkozy said in a speech to the UN General Assembly, Reuters reports.
"I am told 'We don't know who is responsible.' Oh yeah? Well let me tell you that when things were going well, we knew who got bonuses. What a strange system," he also told journalists, denouncing "a crazy system which has been our system for years."
Mr Sarkozy hopes to see an international meeting to discuss the crisis, the worst the world has seen, he said, since the Great Depression.
"I'm convinced that it's the duty of heads of state and government of the countries most directly concerned to meet before the end of the year to examine together the lessons of the most serious financial crisis the world has experienced since that of the 1930s," Mr Sarkozy said before the UN General Assembly, in his first public statements on the financial crisis.
At a press conference later in the day, he said he was thinking of a G8-format summit in November, gathering the world's eight leading economic powers – namely the United States, France, Britain, Germany, Italy, Japan, Canada and Russia, but also open to "emerging countries," such as China, India, and Brazil.
Mr Sarkozy did not specify where the summit should take place, saying that it could be anywhere from Washington or New York, to London, Brussels and Paris.
Additionally, the French president suggested a general overhaul of the financial system should be considered, where capitalism would be more "regulated."
"Let us rebuild together a regulated capitalism in which whole swathes of financial activity are not left to the sole judgment of market operators, in which banks do their job, which is to finance economic development rather than engage in speculation," he was reported as saying by Deutsche Welle.
His comments come just a day after MEPs also called on the European Commission to come up with legislation plans to regulate the activities of hedge funds and private equity funds.
However, EU internal market commissioner Charlie McCreevy told MEPs he did not believe it was "necessary at this stage to tar hedge funds and private equity with the same brush as we use for the regulated sector. The issues relating to the current turmoil are different."
One should "analyse the impact of the existing EU provisions and of additional member states' rules in this field before one embarks on introducing any new legislation," said the commissioner.
EU-Russia economic space
Separately, the EU president-in-office also suggested establishing "a common economic space that would unite Russia and Europe."
"What Europe is telling Russia is that we want links with Russia, that we want to build a shared future with Russia, we want to be Russia's partner," Mr Sarkozy said.
According to him, the initiative for a common economic space would go "beyond the strategic partnership as thought of until now," but would not aim to establish "a common market" either.
However, the French president also referred to Russia's war with Georgia this summer and underlined that the EU "cannot compromise on the principal of sovereignty and independence of states."