France, Germany Want Concrete G20 Results

Germany's Chancellor Angela Merkel ,right, listens to French President Nicolas Sarkozy during their joint press conference in Central London, Wednesday April 1, 2009. AP Photo/Max Nash

The leaders of France and Germany struck a more conciliatory tone on Wednesday ahead of the Group of 20 economic summit, standing firm on the need to sign up to new financial market regulations but backing off from an earlier threat by French President Nicolas Sarkozy to walk out.

Speaking at a news conference with German Chancellor Angela Merkel, Sarkozy said concrete steps must be taken now on tax havens, hedge funds and ratings agencies.

He said France and Germany had set all three as "red lines" in the negotiations, suggesting that if the summit doesn't agree to rein them in, it will have failed.

Merkel said both leaders had come "in a very constructive mood." But she said that "we do not want results that have no impact in practice."

Sarkozy avoided reiterating an earlier threat to walk out of the summit. He had implied he might walk out if the summit's agreement didn't toughen financial regulation.

He said Wednesday that: "I have confidence in Obama" and "I am sure that he will help us and that he will understand us."

As for walking out, he said "it would be annoying to leave when I have just arrived."

Sarkozy set out ultimatums, however, on tax havens, hedge funds and ratings agencies. He said France and Germany had set all three as "red lines" in the negotiations, suggesting that if the summit doesn't agree to rein them in, it will have failed.

Asked whether Mr. Obama's resistance to greater regulation was growing, Merkel replied: "I can't confirm that."

"We have seen with satisfaction that there is now a great deal of talk about regulation in the United States of America," she said, noting that "there are a lot of versions of the text, things are in flux."

"I think there are definitely chances for us to move forward here in this area, which is important to us," Merkel said.

Meanwhile, G20 protesters clashed with riot police in downtown London on Wednesday, breaking into the heavily guarded Royal Bank of Scotland and smashing its windows. Earlier, they tried to storm the Bank of England and pelted police with eggs and fruit.
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