Eurozone tensions and financial regulation were likely to dominate inaugural talks between Britain's new prime minister, David Cameron, and German Chancellor Angela Merkel scheduled for Friday in Berlin, according to dpa. Cameron, who last week took over as leader of Britain's new Conservative-Liberal coalition, held talks with French President Nicolas Sarkozy in Paris late Thursday, on his first official trip abroad. Ahead of the trip, Downing Street said it was Cameron's aim to establish "positive and pragmatic" relationships with the two major European partners which have, traditionally, not always been easy. But the euro crisis and German calls for greater regulation threatened to overshadow the visit. Cameron's trip falls on the day the German parliament is due to approve a 750-billion-euro (938-billion-dollar) eurozone rescue package. The vote was expected to pass without the support of Germany's main opposition party, highlighting tensions within the 16-member euro currency area. The opposition Social Democrats (SPD) have decided to withhold their approval because they believe Merkel's centre-right government is doing too little to regulate financial markets. On Thursday, Merkel's call for a global tax on financial transactions fell on deaf ears at an international meeting in Berlin, ahead of next month's summit of the group of 20 (G20) leading industries. Britain opposes such measures, for fear that tighter taxes and fund regulation could harm the interests of the City, London's financial centre. Speaking in London before his departure, Cameron also signalled his opposition to German proposals to seek amendments to the Lisbon Treaty in the light of the current upheavals in the eurozone. "There will be no further transfers of powers in this way," Cameron said, adding that his government was committed to holding national referendums on any further treaty changes. The point was emphasized by David Lidington, Europe minister in the Foreign Office. "I don't think there's a great appetite, not just in Britain, but in the rest of the European Union, for further treaty change after the very long, drawn-out and controversial process of Lisbon," Lidington said. Officials have said that, while Britain is not part of the eurozone, its economy cannot remain immune to the current problems. More than 50 per cent of British exports go to European Union countries. Apart from European issues, Afghanistan, Iran and the G8 and G20 meetings in Canada next month are likely to be discussed. Merkel is also certain to express concerns about Cameron's decision to take Britain's Conservative Party out of the centrist European People's Party (EPP) grouping in the European Parliament, in favour of a more fringe grouping of nationalist member of the European parliament.
