Prime Minister François Fillon said on Tuesday that French banks need to increase their capital by about €10 billion ($14 billion) to deal with the debt crisis but will not require public money to do so.

"/> Prime Minister François Fillon said on Tuesday that French banks need to increase their capital by about €10 billion ($14 billion) to deal with the debt crisis but will not require public money to do so.

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NICOLAS SARKOZY

French banks need €10 billion boost: PM

Prime Minister François Fillon said on Tuesday that French banks need to increase their capital by about €10 billion ($14 billion) to deal with the debt crisis but will not require public money to do so.

French banks need €10 billion boost: PM
EPP

“The recapitalization of banks will be done in an orderly fashion, for all European banks that need it,” Fillon told lawmakers in France’s National Assembly.

“Speaking of France, it (the recapitalization) should be in the order of €10 billion, in other words below their profits, which means that (French banks) can recapitalize without needing to ask for public aid.”

He said an agreement on the recapitalization had been reached at a summit of European leaders on Sunday.

His remarks came as Europe struggled on Tuesday for a solution to its debt crisis as talks intensified to shield Italy and press banks to take losses on Greek debt on the eve of a decisive summit.

Fillon lashed out at some “commentators and politicians” who he said were trying “to constantly put down our country by neglecting … the role it is playing in the fight against this crisis.”

“If we reach an agreement (during an EU summit) on Wednesday, the president will be able to launch a very important cycle for global growth at the G20 summit, centred on coordinating the economic policies of the great powers,” he said.

French President Nicolas Sarkozy is to host leaders from the G20 bloc of leading economies in the southern city of Cannes on November 3rd and 4th.

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EUROPEAN UNION

How Britain tried to turn former French president Chirac against the euro

British diplomats tried to establish a "very private link" with former French president Jacques Chirac with the "unavowed aim" of exposing him to the risks of a European currency union, declassified documents revealed Thursday.

How Britain tried to turn former French president Chirac against the euro
French President Jacques Chirac (L) welcomes British Prime Minister John Major at the Elysee Palace 29 July 1995 in Paris. Photo: AFP
The government files from 1995 document Britain's plan to influence the French president's decision on whether to proceed with the Economic and Monetary Union (EMU), the group of policies that led to the formation of the euro.
   
“Chirac is alive to the risks of ploughing ahead with the EMU without thinking through the implications,” then British ambassador in Paris Christopher Mallaby wrote to the prime minister at the time, John Major, in a cable outlining his plan to “move the debate in our direction”.
   
He suggested “establishing a very private link” between Downing Street and Chirac's Elysee palace. 
   
“The pretext could be private discussions” about currency union, he wrote.
 
Photo: AFP
 
“The unavowed aim would be to ensure that Chirac was exposed to the risks of an early move to EMU, including the divisive political effect within the EU,” he added.
   
Britain never joined the currency union, having infamously been forced to withdraw the pound from a precursor on “Black Wednesday” in 1992 when it could 
not keep sterling above an agreed level, and was keen to stall the move towards a full union.
   
Mallaby targeted Chirac as a potential ally, saying his “thinking is unformed and influenceable.”
   
The documents also revealed Chirac's scepticism about European integration.
   
“He said bluntly that Europe was no longer very popular,” a foreign office cable quoted him as saying at a 1995 heads of government meeting.
   
The president added that the “EU seemed to be cut off from the real problems affecting the ordinary citizen… and people saw it as a mammoth bureaucracy poking its nose in where it was not needed,” added the memo.
   
Prime Minister Major replied that “he had been waiting five years to hear someone else say things like this!”, according to the cables.
   
Major is now a fierce opponent of Brexit, having been fatally damaged in office by internal divisions over his decision to sign Britain up to the Maastricht Treaty in 1992.
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