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Paris, Berlin not happy with draft

President Nicolas Sarkozy insisted on Wednesday that G-20 leaders must use their London summit to crack down on tax havens, warning Paris and Berlin are not happy with current drafts for an accord.

world Updated: Apr 02, 2009 01:23 IST

President Nicolas Sarkozy insisted on Wednesday that G-20 leaders must use their London summit to crack down on tax havens, warning Paris and Berlin are not happy with current drafts for an accord.

France has thrown down the gauntlet ahead of Thursday's summit of leading world economies, threatening to walk out unless there is a deal on tough regulation of global finance and curbing offshore tax havens.

Sarkozy said he spoke with German Chancellor Angela Merkel late Tuesday and that they had agreed that, while “no firm agreement has been reached” between G20 negotiators, the latest draft deal “didn't add up.”

“Neither France nor Germany are satisfied with the proposals as they currently stand,” Sarkozy told Europe 1 radio just hours before taking the presidential jet to London to meet fellow G20 leaders in Downing Street.

Sarkozy and Merkel are to hold a joint news conference in London to press their demands for new accounting norms, regulation of trader bonuses, a registry of hedge funds and a clampdown on tax havens.

The French leader said some G20 powers had shown “less enthusiasm” for tough new rules, citing the “relative tolerance” shown in the past by so-called “Anglo-Saxon’ countries towards tax havens, and also singling out China. “We need to assess China's exact position, because behind it there are the interests of Hong Kong, of Macao and perhaps even Singapore,” he said.

Obama, Brown downplay rift

President Barack Obama and British Prime Minister Gordon Brown exuded optimism about a global deal to help pull the world out of recession in a attempt to downplay a rift with French President Nicolas Sarkozy ahead of the imminent G-20 leaders summit. Obama has said he was “absolutely confident” that the meeting of rich and emerging countries would find consensus. In a join press conference the pair said that any differences were “vastly overstated.”