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Euro rescue: policymakers woo business leaders

German chancellor Angela Merkel on Wednesday appealed to business leaders at the World Economic Forum to give policy makers the space they need to tackle the debt crisis, pledging that Europe will pull together and restore confidence. Voices and Tweets

business Updated: Jan 27, 2012 01:20 IST

German chancellor Angela Merkel on Wednesday appealed to business leaders at the World Economic Forum to give policy makers the space they need to tackle the debt crisis, pledging that Europe will pull together and restore confidence.

“I would like to ask all of you who are here as the representatives of the business community to recognize how democratic governments work and to please take the long-drawn- out processes with a degree of acceptance,” she said.

Even as the German Chancellor stuck to her agenda of reform for debt-troubled European economies, she warned that her country doesn’t have an infinite ability to help. “It makes no sense if we keep promising more money but don’t combat the causes of the crisis,” she said, even as legendary speculator George Soros came down heavily on European policy makers for tackling the crisis.

Voices and Tweets

“Unfortunately, the European authorities had little understanding of how financial markets really work, and did everything wrong,” said Soros.” “Greece was on the edge of a default that could push it out of the euro... The trouble is that the austerity that Germany wants to impose will push Europe into a deflationary debt spiral.”

Following his remarks, the euro lost a cent against the dollar, falling below $1.30.

British Prime Minister David Cameron meanwhile launched a stinging attack on his European partners, slamming the eurozone as uncompetitive and branding a planned transaction tax “madness”. He also called on for Europe to bypass the Doha talks on world free trade deal in favour of seeking separate agreements with the US, Africa and others.