The British-German disconnect will shape two parallel processes: whether the UK remains in the 27-nation EU, and whether the 17-nation euro area evolves past the debt crisis into an economy productive enough to afford its social safety nets.
“The British view is that the City is the largest financial centre in Europe by a mile, so there is that attitude that we know how to do it and we’ll tell you”, said Graham Bishop, who has advised European officials on financial regulations for two decades and is author of the book, 'The EU Fiscal Crisis'. “It doesn’t go down too well.”
The drive to impose eurozone bank regulation will widen the divergence between Berlin and London. As a country sitting out the euro, Britain has a natural exemption from the regional banking supervisor to be housed within the European Central Bank. It will also have nothing to do with a financial transaction tax being engineered by 11 countries, including Germany and France, over British opposition.
To be sure, Germany and the UK are frequent allies in setting rules for the single market that governs all 27 EU economies. Both share free-trading instincts, offsetting the French bias toward industrial control and protectionism; both want far-reaching climate regulation, blunting the more lenient stance on pollution of lesser-developed eastern European economies. Britain stakes its influence on “competitiveness”, a catch-all term that can mean growth, productivity, labour mobility, appeal to foreign investors and business start-ups, regulatory standards, tech-friendliness, education, the citizenry’s health and well-being -- or a combination of these.
Full article
© Bloomberg
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article