European leaders to meet in Paris
The leaders of Europe's four biggest economies – Britain, France, Germany and Italy – will meet tomorrow, Paris announced, amid sharp disagreement over how to respond to the global financial crisis. President Nicolas Sarkozy's office said the summit would help European members of the G8 group of nations coordinate positions before next week's meeting of rich world finance ministers in Washington.
But the build-up to the Paris talks has already revealed deep divisions between the European powers on how to protect the banking sector, with Germany dismissing calls for a joint European fund to bail out banks.
On Thursday, the Dutch government said it had come up with the idea, and France angrily denied that it had ever suggested such a plan, as had been claimed on Wednesday by a European official in Berlin. Sarkozy himself insisted to reporters that France had not suggested creating a €300-billion (Dh1.7bn) fund, and the finance ministry insisted that both the figure and the idea had come from the Dutch. "There was an exchange of ideas, but no French proposals. There was no French plan. There is no French fund," said an official in Finance Minister Christine Lagarde's office, denying the "groundless accusations".
In the Hague, government spokeswoman Hendrieneke Bolhaar said: "The Netherlands has proposed that we think it would be right for all European countries to make a reservation."
She did not say how big such a fund would be. She added: "I cannot go into the details. We are still discussing the details with other states and partners."
Many media commentators blamed France for the confusion, suggesting Sarkozy was so keen to take credit for leading Europe's response to the crisis that he had forged ahead with summit plans without consulting his partners.
The French president has invited Germany's Chancellor Angela Merkel and Prime Ministers Gordon Brown of Britain and Silvio Berlusconi of Italy to Paris. European Commission President Jose Manuel Barroso, European Central Bank Chief Jean-Claude Trichet and the Head of the Eurogroup Finance Ministers' Committee, Jean-Claude Juncker, will also attend.