France - Eurozone

We now have a two-tier Europe, admits Sarkozy after Cameron veto

Reuters/Jacky Naegelen

French President Nicolas Sarkozy has admitted there is now a two-tier Europe after the decision by British Prime Minister David Cameron at a European Union summit in Brussels on Friday to veto a pact aimed at saving the euro.


In an interview with daily Le Monde, Sarkozy stressed he and German Chancellor Angela Merkel had done everything possible to convince the British to join the deal.

“But unfortunately, there are clearly two Europes,” he said. “One is for greater solidarity and regulation between members while the other is attached to the logic of the single market.”

Dossier: Eurozone in crisis

But President Sarkozy insisted that there is a place for Britain in Europe and the possibility of the country leaving the single market was not likely in the foreseeable future.

He also said the two countries agreed on a number of issues.

“We need Britain and it would impoverish the EU if they were to leave,” he said. “With London we share an attachment to nuclear energy and we have strong agreements on defense.”

Sarkozy repeated his comments from Friday’s talks that Cameron’s demands on financial services were not acceptable to eurozone members.

The British PM wanted a guarantee that closer eurozone co-operation would not undermine the EU single market as well as technical safeguards for the City of London.

“The crisis was brought about by a lack of financial regulation,” Sarkozy explained, “and we could not accept what would be a step backwards. Europe must move towards greater regulation.”

EU Economic Affairs Commissioner Olli Rehn was more critical of the British move. He warned that London’s veto would not protect the City of London from new financial regulation.

“I regret very much that the UK was not willing to join the fiscal compact. I regret it not only for the sake of Europe, but for the sake of British citizens,” Rehn said.

Meanwhile, rating agency Moody’s stepped up pressure on the eurozone on Monday by declaring the crisis talks had failed to produce ‘decisive policy measures” and threatened to review the credit ratings of all EU states within the next three months.




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