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Joint press conférence given by M. Nicolas SARKOZY, President of the Republic, and Mrs Angela MERKEL, Chancellor of Germany – excerpts -

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Meseberg, 10 September 2007

THE PRESIDENT – Thank you Angela. I'd like to thank the Chancellor for her welcome, for our excellent talks and tell her how pleased I am with the work we've been pursuing jointly for four months.

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COMMITTEE OF WISE MEN/EUROPE'S MEDIUM-TERM FUTURE

I believe that, of all the decisions we took, three are particularly important. Firstly, there's Germany's support for setting up a group of wise men to look at what Europe should become in 30 years' time. It's absolutely essential and Angela Merkel's support is crucial. We're going to flesh out this proposal further to see how the group is going to operate and what its members' profiles might be.

FINANCIAL CAPITALISM

Second joint proposal: we have to make financial capitalism more ethical. We can no longer let a few dozen speculators bring down a whole international system, borrow regardless of the conditions and buy at absolutely any price. Not knowing who the lender is – i.e. this absence of transparency Mrs Merkel emphasized – can't go on any longer. This is why we're asking for our finance ministers to be able to discuss this in a forthcoming Ecofin Council meeting and for it to be discussed by the European Council. We've already referred the matter to President Socrates.

We want transparency. We want regulation. We want a capitalism for entrepreneurs and not speculators. We can't accept Europe's workers, salaried employees paying for the imprudence of a few dozen or few hundred economic players indulging in speculation.

AFGHANISTAN

Finally, third initiative: Afghanistan. We're going to strengthen our collaboration. We want to work with our German friends to help in the country's reconstruction, help in training senior Afghan State officials and bring a bit of peace and security to this country which has great need of it.

ENERGY

Q. – Did you talk about Siemens and energy in Europe?

THE PRESIDENT – It isn't for me to interfere in the German political debate and I'll just say two things. The first is that France opted, a long time ago, for nuclear energy. And France has never regretted this choice. Nuclear energy is the energy of the future. France is of course ready to collaborate with groups like Siemens, which is already in Framatome. One day all European countries will have to consider defining a common energy policy. Moreover, I intend proposing that during the French presidency, we put the issue of a European energy policy on the agenda.

Nevertheless, I said to the Chancellor that although we had opted for nuclear energy and are going to pursue an ambitious policy in the field, we also want to develop renewable energies. It isn't either nuclear energy or renewables. In my view, and I believe also in the Chancellor's, it's both. (···) At any rate, I think in Europe we can't remain inactive in the face of a situation where, in 100 years' time, there will no longer be any more gas, and in 30 or 40 years no longer any more oil. No one can imagine that wind energy will be enough to power the whole of Europe. It's a matter which has to be considered. It's Europe's duty and I'm keen to see a European energy policy. Ought we to buy gas together? What joint industrial projects can we have? Quite obviously, I'd very much like Germany and France to have similar goals on the energy front. In fact I tell our German friends that we are on the other side of the border, and so it's difficult to have one choice on one side, in France, and a different one on the other, in Germany. I'll say no more. As a gesture of friendship, we're saying: let's collaborate on nuclear energy and on renewables. Why choose one and abandon the other? We have to do both.

FINANCIAL MARKETS/REGULATION

Q. – Chancellor Merkel, you've said that you wanted more regulation in the financial markets. Can you be more specific on what you want? M. Sarkozy has said he wanted more rules, more control. Do you agree?

THE PRESIDENT – I'll take four very brief examples: have the rating agencies done their work? How can they do it better? Angela talked about this and it's a question we have to consider.

Second question, who is borrowing and under what conditions? It's absolutely fascinating. With the reinsurance system, we don't know whom we're borrowing from. At the end of the day, who is responsible for ensuring the fair price?

Thirdly, what are our banks' commitments, with what risks? Our savers have to know. Not everyone reads 18-page contracts written in tiny print.

Fourthly, can we protect our industries and not from their competitors but from predators? I.e those who are going to raise substantial funds, who start off by laying off 25% of the staff, who are going to carve up the group for sale and when they've done that get their money back. Capitalism and the market economy weren't made to accept that. A competitor buying a rival with an industry project is part of business life, but we haven't got to accept predators, whose existence and source of funds we're unaware of, paying for the business they're taking over by selling off its assets. We're talking about hundreds of thousands of jobs.

I'm for the market economy, I'm for globalization, but I'm not for a speculation-based economy. The genuine market economy is based on transparency, as Angela said, and on reciprocity. There's no reason for Europe being the only area where everyone else comes to help themselves, Europe obeying the rules for the others and subjecting itself to them. When there are illicit relocations, people lose their jobs and the duty of the heads of State and government is to defend their fellow citizens. And the aim isn't to practise protectionism. Reciprocity is a strong political commitment.

When I look at the legislation in certain countries – the US and China – I think that we don't need much advice on freedom and liberalism. Let things be perfectly clear: we're determined to modernize our economies, decent people are paying the price for things they are absolutely not responsible for. (···)

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