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Monti: Euro not in crisis

Jan 09 2012 07:31 AFP

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Rome - Italian Prime Minister Mario Monti on Sunday rejected talk of a euro crisis and said Rome was open to the idea of a tax on financial transactions championed by France - but only if the measure was part of a European Union-wide effort.

"The euro is not in crisis, the currency has solidly maintained its exchange rate with the dollar," Monti said on RAI 3 public television, adding that Italy's "banking system is not under threat".

"The problem we are facing is that some EU countries have a public debt crisis," he said. "Our crisis is a systemic crisis."

Monti, a former European commissioner who took office as Italy's prime minister and finance minister in November, said Italian commercial banks "are not under threat".

His comments came as Italy's top bank UniCredit on Wednesday set a low price for the share issue to raise the €7.5bn it needs to meet new capital requirements, sending its share price plunging.

Unicredit said it would sell shares in the capital increase beginning on Monday at €1.943 each, which represents a 43% discount from their theoretical fair value based on the increase in the number of shares and Tuesday's market price.

Referring to plans for a tax on financial transactions, Monti said the government headed by his predecessor Silvio Berlusconi had voiced its opposition at the EU level.

"I however have expressed the Italian government's openness on that issue," he said on Sunday.

"We are prepared to work on it but never, and I mean never, if it was to apply only to Italy. By contrast, at a time when it is in our interest to cooperate closely with Germany and France, why not," he said.

French President Nicolas Sarkozy said on Friday that France should not wait for other European countries to get on board with the so-called Tobin tax, named after Nobel Prize-winning economist James Tobin.

Monti, who had already said on Friday he thought such a decision needed EU-wide backing, said his openness to the idea "has nothing to do with the fact that I was a student of Professor Tobin".

Britain, which fears for the future of the City of London financial district, has said it would block any move to introduce an EU-wide Tobin tax.

Sarkozy is to hold talks with German Chancellor Angela Merkel in Berlin on Monday to harmonise their stance ahead of a January 30 European summit on the union's debt crisis.

mario monti  |  italy  |  euro  |  tobin tax  |  europe debt crisis
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