Berlin, September 01: France and Germany called Monday for stronger international rules regarding bankers’ bonus payments during talks in Berlin ahead of next month’s G20 summit in Pittsburgh.
The proposal formed part of a joint demands by German Chancellor Angela Merkel and French President Nicolas Sarkozy for “tangible achievements” at the summit of the Group of 20 leading nations on September 24-25.
“The international community needs to understand that the excesses of speculation and finance (institutes) which led to the crisis cannot resume as though nothing had happened,” Sarkozy told journalists in Berlin.
Merkel also reiterated her demands for stringent international banking regulations.
“No bank can be allowed to become so big that it is in a position to blackmail governments,” the chancellor said.
The leaders were due to outline their demands in a letter to the Swedish EU presidency, calling for a joint European position at next month’s talks.
Sweden is convening an extraordinary EU summit on September 17 in a bid to iron out any differences among the bloc’s 27 leaders ahead of the Pittsburgh gathering.
Merkel and Sarkozy stressed the need to act now on principles agreed at April’s G20 summit in London. “Whether it will come to the necessary successes is still unclear,” the chancellor said, adding, “the opportunity must not be passed up on.”
Last week, Sarkozy announced plans to curb French bankers’ bonuses in a bid to deter the kind of excessive risk-taking that has been blamed for the global financial crisis.
His plan involves staggering bonuses over a three-year period, converting at least one-third of them in shares and making them subject to performance criteria.
Similar proposals have been drawn up in Germany, where Merkel wants bonuses to be withheld for four years, a move considered a likely vote-winner ahead of Germany’s general election just days after the Pittsburgh summit.
Monday’s talks between Sarkozy and Merkel will be followed by a meeting in Berlin on September 6 between the German leader and British Prime Minister Gordon Brown.
–Agencies