UK-French rivalry set aside for EU summit

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By Laurence Peter BBC News, Brussels

This EU summit could almost go down as the rebirth of the entente cordiale, with French President Nicolas Sarkozy and UK Prime Minister Gordon Brown grabbing the headlines by uniting to confront climate change and bankers' bonuses.

But extravagant bonuses might prove as hard to shift as clouds of CO2. The Anglo-French initiative might be seen as populist politics unless major financial centres like New York and Hong Kong come under serious pressure to follow suit.

Financial services are so globalised that it probably requires the International Monetary Fund to make new taxes on bonuses and financial transactions effective, along with other measures to curb excessive risk-taking. Yet IMF head Dominique Strauss-Kahn is no fan of introducing a so-called "Tobin Tax" on financial transactions.

A joint Brown-Sarkozy letter in Thursday's Wall Street Journal was the opening salvo, and the Anglo-French alliance was on show again with a rare joint news conference at the summit.

This was probably aimed at reassuring business leaders in the City of London, still jittery after Mr Sarkozy appeared to rejoice at the appointment of Frenchman Michel Barnier to oversee the EU single market, including financial services.

Mr Sarkozy told the daily Le Monde that the "English" were "the big losers in this affair".

Mutual bonhomie

That traditional rivalry was shoved aside at this summit. Mr Brown said Mr Sarkozy "is one of my best friends and we work together on most major issues".

Mr Sarkozy reciprocated, saying "we wouldn't have got the [EU] Lisbon Treaty without Gordon Brown's leadership".

The mood on the second day lifted dramatically when a breakthrough was reached on early funding to help the world's poorest countries adapt to climate change.

Britain and France will contribute at least 1.7bn euros over three years

The commitment of 2.4bn euros (£2.2bn) a year from the EU is aimed at inspiring the rest of the world to reach a global deal in Copenhagen. The goal is a global amount of 7bn euros annually for 2010-2012.

The EU agreement was "unanimous" - but negotiators were up all night hammering it out. Poland and some other East European countries said they were unable to give cash, and offered instead a percentage of the future sale of their unused carbon credits.

The EU wants to see a comprehensive global package on climate change finalised by mid-2010. It will succeed the Kyoto Protocol, which expires in 2012.

Sweden, chairing the last European Council of its EU presidency, had made this "fast start" funding a priority at the Brussels talks.

World leader?

Coming half-way through the crucial UN conference in Copenhagen, this agreement gives EU leaders more ammunition to take to the Danish capital next week.

Greenpeace activists breached security at the summit by dressing as delegates

The EU already sees itself as a world leader on climate change, having put in place a legally binding pledge to cut CO2 emissions by 20% by 2020.

EU leaders stressed their readiness to raise that target to 30%, "provided that other developed countries commit themselves to comparable emission reductions and that developing countries contribute adequately".

They needed no reminders of the urgency of this issue - but they got them anyway. On Thursday the President of the European Parliament, Jerzy Buzek, said this summit was "decisive" and urged them to "put a figure on the table".

The parliament played a significant role in shaping the EU's climate change package.

And more dramatically, Greenpeace staged a stunt as the summit opened, infiltrating one of the motorcades. Activists jumped out of a silver minivan and unfurled banners saying "EU: Save Copenhagen", in front of the world's press, before security guards moved them away from the red carpet.