9 Jan 2012

Merkel and Sarkozy meet over jobs and growth plans

Angela Merkel and Nicolas Sarkozy are meeting to discuss ways to boost growth in eurozone states struggling to overcome the sovereign debt crisis and rising unemployment.

Merkel Sarkozy - Reuters

The German and French leaders will also attempt to finalise a deal to increase fiscal co-ordination within the currency union.

It’s the latest attempt to get the eurozone back on track after it was rocked by a series of economic crises last year, and follows the December summit at which the UK Prime Minister David Cameron vetoed EU treaty changes.

While this raised some obstacles for the rescue plan, discussions are ongoing about how to take it forward without the UK’s input.

The leaders may discuss a financial transaction tax, the “Tobin tax”, being promoted by France but resisted by Britain unless adopted on a global scale, which could split the European Union at a summit at the end of the month.

President Sarkozy may try to accelerate plans for the tax, which he has set out as a priority ahead of the election, and which he vowed to implement in France even if EU partners like Germany are not on board.

Prime Minister David Cameron has said he would veto a European-wide financial transaction tax unless it was imposed globally, deepening the confrontation over the matter with both France and Germany.