By Adrian Croft
WASHINGTON, May 18 (Reuters) – British Prime Minister David
Cameron and new French President Francois Hollande clashed on
Friday over the need for a financial transactions tax to fund
growth but played down other differences over how to respond to
the euro zone debt crisis.
Both leaders said after a first 35-minute meeting at the
British ambassador’s residence in Washington that they backed
measures to cut deficits and spur growth in Europe, glossing
over differences between Hollande’s pro-growth stance and
Cameron’s emphasis on reducing debt.
But Cameron said he would maintain his staunch opposition to
a tax on financial transactions that Hollande backs as a way to
raise revenue to boost growth.
“On the financial transactions tax, I’m very clear, we are
not going to get growth in Europe or Britain by introducing a
new tax that would actually hit people as well as financial
institutions,” Cameron told reporters before his meeting at the
elegant ambassador’s residence, designed by famous British
architect Edwin Lutyens in the 1920s.
“I don’t think it is a sensible measure. I will not support
it,” he said.
Cameron, keen to prevent damage to Europe’s leading
financial centre in the City of London, has previously
threatened to veto a European-wide financial transaction tax
unless it was adopted globally, setting him on a collision
course with France and Germany which back the idea.
A British government source said Hollande and Cameron agreed
they had “different positions” on the financial transaction tax,
also known as the Tobin tax.
Hollande also repeated to Cameron that he intended to pull
France’s combat troops out of Afghanistan this year, two years
earlier than a NATO timetable for ending combat operations.
Cameron understood this was an election promise Hollande had
made, the British source said.
On the euro zone economic crisis, Cameron said Hollande and
he both wanted to see “stability in international markets.”
“We both want to see countries deal with their deficits and
we both want to see economic growth,” Cameron said.
Hollande said the two leaders were “convinced we need to
continue improving our public accounts while restoring growth.”
On Greece, Hollande said he would like Greece to remain in
the euro zone but it would be for the Greek people to “answer
the question.”
“My position is we should do everything possible so that
they say yes to that,” he said.
Cameron earlier called for “decisive action” to tackle the
euro zone crisis.
“Britain wants to have a successful euro zone, that is where
40 percent of our trade goes. We need decisive action from euro
zone countries in terms of strengthening euro zone banks, in
terms of a strong euro zone firewall and decisive action over
Greece. That has to be done,” Cameron told reporters.
“Clearly the Greeks have to make their minds up, they have
to make their decision. Decisive action needs to be taken.
That’s absolutely vital that it is because that will affect the
stability not only of the euro zone economies. It affects our
economy and it affects the world economy too,” Cameron said.
The EU trade commissioner said earlier on Friday that
European officials are working on contingency plans in case
Greece bombs out of the euro zone
Cameron, a centre-right Conservative who built a close
relationship with Hollande’s predecessor Nicolas Sarkozy,
snubbed Hollande when the Socialist leader visited London during
his election campaign, but at Friday’s meeting he invited
Hollande to visit London soon.
Hollande made ironic reference to the snub, saying that
since he had not been able to visit London before the election
he would be “all the happier” to meet Cameron afterwards.
