A transcript of a joint press conference given by French President Nicolas Sarkozy and the Prime Minister in Evian on 6 July 2009.
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President Sarkozy:
Ladies and gentlemen, we’ve just concluded a working session with the British Prime Minister, whom I wish to welcome, of course, to France, together with his very important delegation. I must say, the more we work together, the more there is a convergence of views between our two countries: total convergence. The Pittsburgh Summit must be farsighted; we do not want a situation whereby, after the crisis, we should find ourselves going back to square one. The United Kingdom and France want the Pittsburgh Summit to be farsighted, ambitious in what it seeks to achieve, and we want hard and fast results when it comes to regulation. We do not want the Pittsburgh Summit to be less ambitious than the G20 Summit London, which was so remarkably chaired by the British Prime Minister.
Now on the G8, we will stand shoulder to shoulder, to ensure that what the G8 does in terms of development and the battle against climate change and global warming, will be again very farsighted. We will not simply settle for way off targets that are too far away. We want medium term targets to shore up our credibility. I was very happy to talk to Gordon Brown about the World Environmental Organisation, and I think it true to say that, at least on principle, he agrees with me, and we are determined to work together on environmental taxation, on a carbon tax. I told Gordon Brown that, of course, we wanted an agreement at the WTO; we do not want to go down the protectionist road, but we want free and fair competition - as opposed to unfair competition.
So on these two fronts, I believe I am right in saying that we see alike. We are determined to get world governance moving as well, on all these aspects: the IMF, the Security Council, and the G20. We raised a host of other bilateral issues, pertaining to nuclear energy, co operation in defence matters, and I stand to be corrected by our two ministers of foreign affairs, but we have stood shoulder to shoulder with our British friends vis-à-vis Iran and the Iranian leadership, and they can count unreservedly on our support and solidarity. We will do whatever they want us to do. We were particularly shocked by the totally unfair, disproportionate attacks and criticism made vis-à-vis the British government. I believe - we believe - that the Iranian people deserve better than the leadership they have today, and I want to say things as clearly as I can on this front.
So we will continue to work together. Now it may well be that at the G8, Gordon Brown and I go and meet the press together, to present proposals that we will be tabling, in particular in respect of climate change. So in summary, and before giving the floor to Gordon Brown, we believe 2009 is a turning point in terms of regulation, new world governance, and the battle against climate change. And we will get things moving together.
Prime Minister:
Can I say, first of all, what a real pleasure it is to be in Evian today, with my friend President Sarkozy, to be with his team of ministers and for our ministers and his to be working together on common projects, and I want to pay tribute to President Sarkozy for his leadership of the European Union over the six difficult months several months ago, for his leadership in the G20 and the G8, and for his drive and his determination to make the world a safer place, a more prosperous place, and a greener place. President Sarkozy, mon ami, you are truly a force of nature.
Britain and France are two countries bound by shared histories and shared geographies, by common values and shared values, and by an enduring strategic alliance. 105 years ago, the Entente Cordiale was signed. Last year, we talked about the Entente Formidable, and today, we can talk about the Entente Formidable au soleil, such is the good weather that we are experiencing today.
Relations between France and Britain have never been better, but the world has changed dramatically over recent months, and we have to respond to it. And that is why President Sarkozy and I were looking, not just at how we can get recovery from the financial troubles of the last year, but how we can secure growth for both our economies and for the world economy. And I am very pleased that, as a result of the discussions today, our two countries will work closely together. You have set up a commission to look at industries of the future, we in Britain are looking at strategic sectors where we need to work with the industries to achieve results, and in those areas of biotechnology, digital economics, in low-carbon production (particularly in the electric car) - in all those areas, we want to work together for the future, and that includes bioscience and biotechnology as well.
And I think our ministers will take out of this meeting a mandate that we look together at the growth sectors for the world economy, see how we can co operate with investment together in the future, and make sure that we are leading the world back to growth.
We also agreed that the G8 and G20 have got to take seriously some of the warning signals that exist in the world economy. Focusing on boosting economic growth is in fact a second wake up call for the global economy. There are fundamental reforms that need to be finalised, some of which were agreed at the G20 meeting, and have still to be completed. We have to increase bank lending, and both of us are worried that the banks have yet to respond in full to the situation which we have, where industries and sectors are calling for help from the banks. We have got to explore options for stabilising, for the long term, the oil price; because we’ve seen a 75% rise in oil prices in only a few weeks. We have got to take action against protectionism where we have world trade falling by 20%, and we must increase private sector investment, and we have a duty to our own populations to do what we can to maintain jobs and create new jobs in difficult times.
I think both of us recognise the ethical issues that have been raised by the banking crisis; that we need a more responsible and fairer approach to economic management, that we need to complete the radical reforms that were agreed at the G20, and we will continue to work together to do so. We agreed that we should accelerate the reforms on tax havens. Where tax havens do not meet the commitments to international standards of transparency, there should be a robust and co ordinated global response. Enforcing tax transparency, full exchange of tax information and reducing tax avoidance are crucial to the future health of the global economy - and the world should be in no doubt that the writing is on the wall for tax havens, wherever they may be.
So we are calling today for a March 2010 deadline for the introduction of sanctions against tax havens: sanctions that could include revising investment policies, imposing taxes on funds held in tax havens, or the withdrawal of aid. And from today, that countdown has begun.
We have also talked about the bilateral issues where both our countries are involved. Ban Ki-moon, last week, reached out to the Burmese junta. We must now respond to the abuses of freedom in the Burmese regime, which were not answered by the regime when Ban Ki moon talked to them, and President Sarkozy and I are looking at what more we can do to ensure that Aung San Suu Kyi is set free.
I am grateful to President Sarkozy for mentioning those people who have been in detention in Iran. We both agree that the outcome of Iran’s election is a matter for the Iranian people. We seek no role in this at all. But the total unjustified expulsion of foreign diplomats, and continued detention of embassy staff is unacceptable and unjustified - and I am therefore grateful to you, President Sarkozy, for your solidarity and your commitment to stand by Britain on this. The Iranian regime must be clear that if this action continues, and we are forced to act, we will act together with our European partners.
President Sarkozy and I share a vision of a better future. It is a partnership based on shared values: Britain and France together building better and newer global institutions, global rules and a global society. Britain and France continuing the strong alliance that becomes stronger every day. Thank you.
Question (Jon Craig, Sky News):
Prime Minister, a member of your cabinet who is not here today, Peter Hain, has written a newspaper article in which he says public spending in the UK will need to be restrained after the next general election. Is he correct about that, and if so, how do you propose to do that? And may I please ask President Sarkozy, you were critical of Britain’s cut in VAT a little earlier - are you still critical of that measure?
Prime Minister:
Well, first of all, we are going for growth. We have published our public expenditure figures for the years after 2011, and these show for current expenditure a real-terms growth in expenditure. And if we can get growth, if we can get unemployment down, if we can keep interest rates and inflation low, then there is scope to do the things that we want to do, and that is to get money to the frontline services.
Today we are talking about how we can get growth in the economy of the future, and we are looking at those industries - biotechnology, digital, nuclear, low-carbon industries - all those industries which are capable of substantial growth in the future. With growth, you get revenues, and with growth, you are able to fund your public services.
President Sarkozy:
Thank you for having raised the question, because it’s very important for me to support unreservedly the British government’s position on the need to achieve real growth worldwide. We cannot afford to have low growth rates over many years. Likewise, I share Gordon Brown’s analysis: namely that we need a much stronger economic co ordination and strategy in Europe and for Europe. Of course we have to combat indebtedness and we have to try and restrain deficit, but we will only achieve that if we restore growth - and if we restore our economies to health. That is self evident: if we do not have more growth, then we cannot balance things out. So if we want growth, we both of us have to do whatever we can to help countries do more.
Now, I’ll come back to your question on VAT in a second, but as far as France is concerned, demand is holding its own, but investment is slipping back. So what is our strategy in France? To do everything we can in order to boost investment, unlike our British friends - and I am not making any criticism or judgement. All I said was that the French Socialist Party had asked me to take the same initiative as the British authorities, and all I said was that what was good for the British economy wasn’t necessarily good for the French economy. With increasing consumption, I did not see why I should reduce VAT on all products. And yet we have a drop of 7% in investment, so we have really thrown our weight in, in order to boost investment.
And I am delighted to be able to tell you that, in respect of the national loan that we are going to be launching in order to finance France’s major future investments, the commission which has been entrusted with the task of giving its opinion on strategic sectors is going to be chaired by two eminent personalities, individuals, and I thank both of them for having accepted this responsibility.
Michel Rocard, a man for whom I have much admiration and esteem, and who shows to what extent our political strategy of opening up to all parties, and people from all walks of life, will not change. France needs to mobilise all its talent an all its energy in order to overcome such a serious situation as that we have. And if there is talent on the left wing of the political spectrum, then it is my responsibility as President of the Republic to call upon them and their talent. And the fact that Michel Rocard has agreed to lend his talent and experience to thinking about what would be the strategic sectors for France’s future in the twenty years to come - well, in the next twenty years, I won’t be where I stand right now, because, as you know, I limited presidential terms to two.
But this is not a matter of political leanings; it’s a matter of men and women of talent putting their heads together to work for a better future. And I thank also, Mr Juppé - Alain Juppé, who was Minister under President Chirac, for having agreed to take this responsibility as well.
And it is something very important which I wish to say to our British friends. Two men of such talent, Michel Rocard and Alain Juppé - one who was from the left, and the other from the right - have agreed to chair this high level think tank to focus on what strategic sectors France must invest in, in order to assure its future. And it should reassure our French men and women that such individuals should have agreed to work together to think about what the best economic and investment strategy should be for our country for the next two decades.
I will meet with them late afternoon today at the Élysée. They will be concluding their work and submitting a report to me in November, and I think it is of the essence that we mobilise our country, above and beyond political divides, in a spirit of tolerance and forward looking tolerance. The future can be held hostage by nobody. This crisis that we face is sufficiently harsh and difficult for it to justify us being bipartisan, above and beyond political divides.
Likewise, a Prime Minister from the left of the political spectrum, and the French President, who is not on the left of the political spectrum, have been working hand in glove. Well, I said ‘not on the left of the political spectrum’; it is up to you to qualify.
Question:
I would have a question for President Sarkozy and for Prime Minister Brown. Did you speak today about the two issues of the EADS, the A400M and the A350? What are the positions of your countries on this, and are in fact the positions of the UK and France getting closer together on these two issues?
Prime Minister:
These are issues that will be dealt with during the course of the day. These are obviously very big projects for both our countries. We want to see them moving forward, and that’s why the discussion will be in detail during the course of today.
Question:
Prime Minister, you give a pretty grim list of things that are happening - rising unemployment, growth in protectionism, falling trade - and it is in some contrast to earlier talk of some early recovery we might hope for. Are you essentially saying today that things are going to get worse before they get better? And President Sarkozy, if I may, you talk of a need for the G8 to set medium-term goals. Are you suggesting then that some countries haven’t taken their responsibilities seriously enough after the G20?
Prime Minister:
When we met as a G20 in April, the immediate things that we had to do were maintain the stability of the banking system, get new rules into the international financial order, to deal with the problem where there had been a breakdown in trust, and to make sure we could prevent the collapse of a number of economies at risk if the International Monetary Fund did not have the resources to enable them to withstand the crisis. Now these were the objectives in April. Now we come to July and prepare for Pittsburgh in September, we’ve got to be more ambitious about what we need to do. We’ve got to get growth back into the world economy. Having stabilised the banks we’ve got to get lending up. Having made sure that we have a world approach to these issues, we’ve got to stop the decline in trade, which has gone down 20%, we’ve got to look at the problems we are having with commodities and we’ve got to look at where the sources of growth are going to come for the future.
I think the challenge moving forward is that if we do not take further action - and that is dealing with commodity prices, dealing with the fall of trade, dealing with the failure of some banks to lend as much as they should be for the future - then we will have low growth, but if we do deal with these problems, then we can see a future where growth can come. I wanted to point out to people the things that need to be done. I also want to point out that there are great growth sectors in this new economy, where France, Britain and other countries can do incredibly well.
They include the digital economy, where thousands of jobs can be created in the future, as long as the investment takes place; biotechnology and the life sciences and healthcare, where there is huge opportunity for countries like ours to succeed in exporting to the rest of the world; nuclear and low-carbon technologies, like the electric or the hybrid car, where by working together we can see how we can make rapid advances in technology and, therefore, make possible new consumer products that people will want to buy.
Of course, in all these areas you need the investment for growth and both our countries are looking - President Sarkozy with the commission that he has set up, in Britain with the reviews that we have also set up - at how we can make this growth happen as quickly as possible. So, yes, there are challenges that arise from what has happened over the past year and we’ve got to get bank lending up, we’ve got to keep oil prices down, we’ve got to get to a situation where world trade is restored, but, yes, there is the next set of challenges after stabilising the banks, and that is to get growth into the world economy and all our emphasis is going to be on getting that growth that is necessary for both jobs and prosperity and at the same time to keep debt and deficits down.
President Sarkozy:
Just a word on this, I think that in London we have made a lot of headway. Gordon Brown, as I, believes that those who think that after the crisis we can go back to business as usual, we will stand in their way. We cannot accept us coming back to the status quo.
To take the example of tax havens: there, yes, we have made headway, we shot across their bows and they felt it, but we’ve now got a black list and a grey list and we’ve got to clear things up. In other words, tax transparency conventions now have to go ahead and be signed. Secondly, on wages, on these crazy wage packages: the more you speculated, the more you earned. If it were to be suggested that we would go back to that we would simply refuse because people were speculating and taking phenomenal risk and being recompensed for that and that is not what capitalism is all about. We want fair capitalism.
If banks were to go back to that system then we will take even tougher, more stringent measures. People have suffered a lot from the crisis and they continue to suffer from the crisis and it is not acceptable that we should go back to square one - bonuses, these pay packages that amount to nothing or that correspond to nothing - people should be rewarded under capitalism when they create value, fair enough, but not when they speculate.
Thirdly, I believe that we have more or less stabilised the financial economy, the financial sector, but there remains the economy and there’s a lot that still needs to be done. We want to do it in Pittsburgh and we want Pittsburgh to set itself as ambitious targets as London did.
Now, perhaps not all countries are so enthusiastic about change around the table. Well, the United Kingdom and France are working hand in glove in order to make things change, shift the lines. Yes, it’s new, but that’s the way it is, and I’m very grateful to Gordon Brown, in particular on the last European Council meeting for having supported European regulation. Everyone has to make an effort: France has to make an effort, the UK is making an effort, and together we are sending out a message loud and clear about what Europe has to say on new world capitalism. With Angela Merkel, with Gordon Brown and others, we are trying to get the idea across that there is a European model. No one is turning their back on their own beliefs, but that is what we are trying to achieve: we are fighting to shift the lines and we are taking risks.
Question:
On climate change, I’m going to put a question you might find a little simplistic, but I’ll put it anyway. By coming here, rather than to London or Paris to convene the summit, you’ve generated a carbon footprint. What are you going to do to counterbalance that?
President Sarkozy:
No, no, no, I can’t answer that.
Question:
But in your struggle against climate change, should it not be up to the governments to set the example by organising perhaps not in Paris and London, but by other gestures?
President Sarkozy:
Well, it was difficult for Gordon Brown to come here by ferry.
Question:
Well, why not Paris?
President Sarkozy:
Well, London or Paris - it’s a very interesting question but frankly I remember a newspaper assessing my carbon footprint. It so happens that the plane in which I came emits less CO2 than others, but I’ll leave it up to Gordon to answer the rest of the question if he wants. If by meeting, we can get decisions taken at world level, do you not think that on balance that is more important? Do you think simply that by sitting in my study or Mr Brown sitting or standing in Downing St, we could get things moving, as we are? Do you think we do this because we enjoy simply meeting on a fine day out? No, we’ve come to talk about, amongst other things, taxing pollution, pollution, environmental taxation. The British already have environmental taxation. With Jean-Louis Borloo, with Christine Lagarde we are going to look at an energy climate tax Do you think we can really do without pooling our information and our intelligence on this?
I went to Sweden last week. The Swedes have such a taxation system. I need to know what the British are doing, what the Swedes are doing. Do you think we need simply to reinvent what already exists or rather harmonise, put our heads together and discuss? You may ask, ‘Why did we come here?’ We came here because it’s a very beautiful place to come and thank you to the Mayor for having invited us, and because I was due to meet with the Ukrainian Prime Minister here a few months ago and I had to cancel the meeting because of the crisis in Georgia, so that is why.
It is very important that our countries spearhead this struggle because domestic environmental taxation, on the one hand, and - I stand to be corrected by Peter Mandelson - but if we talk about a global carbon tax, perhaps we can also make headway on that. We can only have a carbon tax at Europe’s frontiers if we have domestic carbon taxation policies. Furthermore, I needed to convince my British friends that this is not about France wanting to go towards protectionism but it’s for the greater good of all of Europe.
When I go to Geneva - sorry about my carbon footprint - to talk about a World Environmental Organisation, I need to talk to Gordon and explain to him what I had in mind. When he says to me, ‘Yes, I understand, on the principle I agree,’ don’t you think that on balance it’s more important for the greater good of all the world, rather than simply picking up my phone and having the occasional phone conversations?
Prime Minister:
I could be here for the next two days and go straight to Italy rather than go back to Britain and save some carbon. You do raise an important point about the purpose of these meetings and I do believe we are making progress. We have got to get an agreement on carbon and climate change in December. That is less than six months away now. We’ve got to get an agreement on intermediate targets so that people are not just agreed on long-term targets but on intermediate targets. That’s across Europe and then across the whole of the world.
We’ve got to get an agreement on how we can help the developing countries and the emerging markets, countries that cannot afford to make the energy-efficient investment that is needed if we are going to meet our targets on carbon emissions, and how we will finance it. Therefore, the time is short. The need for us to work together on that is very clear. There will have to be international agreements reached and there will have to be pathways to them.
I think the G8 meeting in Italy will help and I think the G20 meeting in Pittsburgh will help, but remember it is only a few weeks in practice until we have to meet in Copenhagen and I don’t want the world to be set back in Copenhagen. The failure to reach an agreement there will be seen as a huge blow to both the environmental movement and the ability of the world to work together on other issues.
So meetings like this, when we are talking - and I think we spend most of the time at our meeting talking about the climate change issue and carbon emissions and what we can do together about it is an incredibly important issue and I don’t apologise for spending time here and for coming here to do this because this has been a most successful meeting.
Question:
Mr President, I wanted to know what you thought about what the press has said about the Tibhirine monks. Do you think the Algerian army has once again slipped up?
President Sarkozy:
I myself went to Tibhirine a few years ago and was deeply moved by what had happened. During my presidential campaign I referred to the will left by the Mother Superior of the convent. Now the events we know, we are familiar with, this is now before the courts, before the magistrates, what can I say at this stage that wouldn’t simply complicate matters for the courts? And when the case has been looked at, reviewed, then we will draw conclusions. I have nothing further to say at this stage.
Question:
One question on oil prices. Prime Minister and President Sarkozy, you mentioned oil prices last Friday. A trader traded on oil stocks which forced an increase in oil prices, so what have you decided to do for the G8 - to cap oil prices, Mr Brown? Would you be in agreement to such capping of oil prices?
Prime Minister:
The big issue that the world economy faces over the next year: we have had oil prices at $150, we’ve had them at $35, they’ve now gone up to $75. The most important commodity that the world economy needs is one of the most volatile and the most unstable. We have got to look at what are the causes of this, what can be done to change this and how the world economy can grow without the instability of a volatile oil price preventing growth. We will have to have discussions with the Saudis and with OPEC, we will have to have discussions with our other partners in the G8 and the G20, but we must do something that makes it clearer what is likely demand and likely supply in the oil market. There’s got to be these discussions to understand what the demand will be in the future, what the supply will be in the future.
Previously, people operated to a range of prices, dollar prices for oil, and that may be something people could consider for the future, and we would like some work done on that. Where there is undue speculation or speculation that is unfair in the oil market, we have got to look at whether there are mechanisms that exist that are making that accentuated and, if there are, we are going to have to be prepared to take action. And of course we need an agreement about how countries are going to move from dependence on oil to non-oil sources of energy in the future.
That is precisely why we and France are committed to nuclear, why we are committed to a balanced energy policy, why we are committed to using renewables in the future, so there is a variety of things that can be done to lessen our dependence on oil, to make the oil price less volatile, to bring supply and demand into greater alignment and to look at alternative sources of energy for the future. These are the things that I think a world community worried about the volatile price of oil has got to look at, and I’m pleased that President Sarkozy has taken the lead in calling for this examination.
President Sarkozy:
In a couple of days’ time we will be making a joint contribution to this discussion. It is not reasonable to let speculators artificially push up the price of fossil fuel. Nor do we think it is reasonable to applaud the fact that oil prices shoot down. We need reasonably priced oil products. With the energy producers, as Gordon Brown rightly said, we need to agree on a reasonable range of prices, neither too high nor too low. The world will not be able to recover from these ups and downs, this yo-yo of prices from one excess to the other, so we need to achieve the upper hand and achieve something reasonable. Thank you.
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