Greek Prime Minister George Papandreou said several European leaders will press for a ban on certain arcane financial tools tied to the 2008 global economic meltdown, in an interview published Monday.
Papandreou told Germany’s daily Handelsblatt that he, German Chancellor Angela Merkel, French President Nicolas Sarkozy and eurogroup chief Jean-Claude Juncker had written to US President Barack Obama calling for an end to controversial credit default swaps (CDS).
“The G20 countries plan to discuss it,” he said. In March, Germany said it was working with France on rules for derivatives markets including CDS, the lucrative trade in complicated insurance investments against the risk of a debtor defaulting that are favoured by speculators.
They were originally aimed at covering against the risk of a debtor defaulting but Athens has blamed the product for deterioration in its prospects of tackling its massive debt crisis which has threatened to destabilise the eurozone.
“We must reinforce the regulation of the market,” Papandreou said. EU and US officials agreed in March to work together to improve the transparency of derivatives markets.
The next Group of 20 summit, bringing together leaders of the major developed and developing countries, will take place in Toronto June 26-27 with market regulation high on the agenda.
Frankfurt, May 17, 2010 (AFP)