Sarkozy aide: No China concessions to invest in EFSF

Europe will not offer China concessions in exchange for contributions to the eurozone’s beefed-up bailout fund, an advisor to French President Nicolas Sarkozy said on Monday.

Eurozone leaders agreed in Brussels last week that emerging nations, led by China, could put money in a special purpose vehicle within the EFSF fund to help increase its firepower.

French President Nicolas Sarkozy, who has said that China would have a “major role to play” in resolving the euro zone’s debt crisis, was accused over the weekend by political opponents at home of selling out Europe’s future to foreign powers.

“It is out of the question to negotiate counterparties. If China comes, it’s to invest in a fund that will play an important role in global stability,” presidential advisor Henri Guaino told Europe 1 radio.

The head of the EFSF (European Financial Stability Facility), Klaus Regling, was in Tokyo after trying to drum up support for the fund from Japan after he courted China.

China declined to commit at the weekend to putting cash into the mooted special purpose vehicle, and Japan told Regling on Monday only that it would continue to buy EFSF bonds.

Guaino said China’s interest in helping Europe to resolve its debt crisis was a positive signal.

“It’s a rather good sign, it shows that everyone really feels concerned and everyone wants to avoid a global catastrophe… I don’t understand the criticisms we are hearing from all sides, it is absurd,” he said.

The prospect of China contributing to the EFSF was still subject to negotiation, while leaders would also discuss the option of emerging nations contributing to the EFSF via the International Monetary Fund at a G20 summit this week in Cannes.

France is scheduled to hold a presidential election in around six months.