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October 27, 2011 8:49 pm
It was four in the morning at the end of the second gruelling eurozone summit in four days and a deal was finally done. But Nicolas Sarkozy was already thinking ahead to the next big international pow-wow – the G20 in Cannes on the Mediterranean coast next week.
At his closing press conference in Brussels, the French president announced he would be talking within hours to Hu Jintao, his Chinese counterpart, about preparations for the meeting of the leaders of the world’s leading economies.
For Mr Sarkozy, putting in place a fix for the eurozone was essential to staunch the sovereign debt crisis that threatened to tear Europe apart. But his next task, as current host of the G20, is no less than to fix the world economy.
A statement issued after the call to President Hu said they agreed to work closely to ensure that the G20 “makes a decisive contribution to global growth and stability”.
The president, who faces re-election next year, also has his eye firmly on domestic politics. He appeared on national television on Thursday night for the first time since February to explain the deal reached in Brussels and how it, along with the G20, will help revive France’s own flagging economy – as well, he hopes, as his flagging popularity.
Mr Sarkozy has made it clear he wants the Cannes meeting to be like the equivalents in Washington in late 2008 and London in April 2009, which were seen as galvanising international action to revive the economy after the deep shock caused by the collapse of Lehman Brothers.
With global growth again ebbing, French diplomats talk of the G20, which takes place on November 3 and 4, as being an exercise in crisis management that must adopt a “real action plan to spur global growth”.
Mr Sarkozy is pressing for decisive moves to address debilitating structural imbalances between, on the one hand, surplus nations such as China and Germany, and, on the other, deficit countries including the US and France itself. He wants the likes of Germany, China and other high-performing emerging countries to sign up to specific policy pledges to promote growth, such as stimulating domestic consumption, while countries in deficit should show how they are taking steps to consolidate their public finances.
Other initiatives on the agenda will encompass new ways of extending International Monetary Fund resources – including potential investment by surplus countries to aid the eurozone rescue package – international monetary reforms to prevent currency and commodity price volatility, regulation of systemically important banks and moves to spur long-stalled trade talks.
But with less than a week to go, people in contact with the preparations say it is far from clear how much concrete action will emerge from the meeting, with surplus countries notably reluctant to sign up to specific growth measures.
There is by now familiar scepticism over any possibility of serious movement on trade. “Governments are always ready to make clear statements against protectionism and then through the back door they take measures that are actually protectionist,” says Laurence Parisot, head of Medef, the French business federation.
None of this will deter Mr Sarkozy. He will doubtless deploy his familiar restless energy to prod and cajole commitments from his fellow leaders. It may not go on all night, but the second instalment of the summit double bill is set to be lively.
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