EU financial transaction tax ‘madness’: Cameron

British PM David Cameron speaking yesterday at the World Economic Forum (WEF) in Davos

The European Union’s plan for a financial transaction tax is “simply madness”, Britain’s Prime Minister David Cameron said yesterday at the World Economic Forum in Davos.
“Even to be considering this at a time when we are struggling to get our economies growing is quite simply madness,” Cameron said as the keynote speaker on the second day of the annual gathering of the world’s elite which this year is overshadowed by a deep foreboding about the global economy – in particular the state of Europe’s finances.
“Of course it’s right that the financial sector should pay their share. In the UK we are doing exactly that through our bank levies and stamp duty on shares. And these are options which other countries can adopt,” Cameron added.
“But look at the European Commission’s own original analysis. That showed a Financial Transactions Tax could reduce the GDP of the EU by 200 billion euros, cost nearly 500,000 jobs and force as much as 90 per cent of some markets away from the EU.”
Cameron’s failure to persuade the European Union to give Britain an opt-out on the financial transactions tax was key in his decision at an EU summit last month not to take part in a fiscal pact designed to safeguard the eurozone.
Chancellor Angela Merkel used her address on Wednesday to say that she was not prepared to expose Germany to more flak from the markets to bail out eurozone strugglers. Merkel also said that Europe had to become more competitive, a theme echoed yesterday by her deputy Philipp Roesler, who was also in Davos, pushing for more innovation and ambition from European firms.
Leaders from Africa meanwhile debated the prospects of the world’s poorest continent at a time when developed nations are in the mire and the outlook for the Arab world remains uncertain at best after last year’s uprisings.
While the opening day of debates focused largely on the state of capitalism, many yesterday’s sessions took a closer look at the challenges facing individual regions.
The role of Islam in the Arab world was discussed, and the state of the Middle East peace process was on the agenda, with Israeli President Shimon Peres debating with Salam Fayyad, the Palestinian prime minister.
South African President Jacob Zuma, Kenyan Prime Minister Raila Odinga and Tanzanian leader Jakaya Kikwete were in Davos to argue that a new generation of African leaders has a strategy to meet their looming challenges.