By Martin Banks - 23rd November 2007
SOFIA: European socialists have adopted a key resolution calling into question the 'behaviour and regulation' of private equity and hedge funds.
The resolution was adopted on Thursday at the opening of the Party of European Socialists (PES) council in Sofia.
The resolution will form part of the manifesto on which Socialists will contest the 2009 European elections.
A debate on the issue dominated the opening day of the two-day event in the Bulgarian capital.
Many of the delegates, including leaders of Europe's social democratic parties, were unable to attend because of adverse weather conditions at fog-bound Sofia airport.
They included Martin Schulz, Socialist group leader in parliament, whose flight from Frankfurt was unable to land at Sofia and had to return to Germany.
Those that did manage to beat the dense fog included Danish MEP Poul Nyrup Rasmussen, president of the pan-European PES party.
He told the party's annual gathering that the "threat" posed by hedge funds should not be underestimated.
"The threat to healthy companies, jobs and workers' rights is the unacceptable face of today's global capitalism.
"There is an urgent need for reform. It is about re-establishing respect among the financial markets for the needs of the real economy.
"With the resolution adopted at the council, the tide is turning in favour of change," he said.
The resolution, adopted unanimously by delegates from 30 parties, calls for "transparency of private equity and hedge funds and the setting of minimum reporting standards."
It demands "effective" taxation of fund managers and calls on the relevant authorities to consider limits on leverage to lower the risk of default.
Other MEPs taking part in the debate included French Socialist Pervenche Beres, chair of parliament's economic and monetary affairs committee, Belgian deputy Mia De Vits and Greek MEP Stavros Lambrinidis.
Lambrinidis said the party was "seriously concerned" with the mounting debts he says are created by hedge funds and private equity funds.
"PES believes that there is no serious argument for private equity and hedge funds to enjoy treatment different from the rest of the financial market."
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