EU to debate extra stimulus calls
March 20, 2009 by samsonites
European Union leaders are set to begin a two-day summit in Brussels aimed at agreeing a strategy for tackling the international economic crisis.
The talks take place as the world’s biggest economies prepare for next month’s G20 summit in London.
Correspondents say EU member states are resisting US calls to spend even more public money to revive their economies.
Germany and France believe stronger regulation should be a priority, while the UK wants more available credit.
Energy security is also expected to figure prominently at the talks in response to the gas dispute between Russia and Ukraine in January that led to severe shortages for millions across Eastern Europe.
The Czech Republic, holders of the EU presidency, will meanwhile call for an “Eastern Partnership” with countries in the former Soviet bloc.
Before the summit started, the president of the European Commission, Jose Manuel Barroso, warned against empty rhetoric.
“What our citizens need now is not words, they need action. I’ve said it before - implementation, not gesticulation,” he said.
Tighter regulation
The BBC’s Oana Lungescu in Brussels says that with output tumbling and millions of jobs at risk across the continent, EU leaders seem to have few fresh ideas to offer and little appetite to throw more public money at the crisis.
"We should send a strong message… of our faith in the scope and effectiveness of our own stimulus programmes"Joint letter by France and Germany EU chokes on cost of rescue
The focus at their two-day summit will be on implementing existing recovery plans, worth 400bn euros ($540bn; £376bn) between 2009 and 2010 - equivalent to 3.3% of the EU’s gross domestic product - rather than announcing new ones as Washington wants, our correspondent says.
In a joint letter, Germany and France indicated Europe was doing enough and said the top priority for the G20 summit on 2 April should be to build up new “global financial architecture”, with stronger regulation and sanctions to tackle the roots of the crisis.
“We should send a strong message… of our faith in the scope and effectiveness of our own stimulus programmes,” they said.
But British diplomats in Brussels say the UK will emphasise that there is a need to make more credit available, and to combat protectionism.
Pipeline squabble
EU leaders are expected to offer to contribute $100bn towards doubling the money that the International Monetary Fund (IMF) has to help countries in trouble.
There is also willingness to put billions more into an 25bn euro ($34; £23.5bn) EU fund for hard-hit Eastern European economies, which Hungary and Latvia are already drawing on.
But our correspondent says there has been much squabbling over what may seem very little - a European Commission plan to use 5bn euros ($6.75bn; £4.7bn) in unspent farm subsidies for new energy and intranet infrastructure.
The German government opposes spending some of the money on Nabucco, a planned pipeline that would bring gas from Central Asia to Europe, bypassing Russia - a project backed by many former communist countries and the US.
An official close to Nabucco told the BBC that the row was quite unhelpful, as the companies involved in the project are hoping to reach agreements on gas supplies from Azerbaijan and Turkmenistan by the summer
This article is from the BBC News website. © British Broadcasting Corporation
I guess the U.S. need to accept the suggestions of the E.U., and the E.U. need to adopt an advanced smart grid technology, which is worth the deficit for job creation and economic activity, is something to do ultimately.
I think like USA, the world economy also urgently needs job creation, and like internet, the global economy requires common ground, that is why The World-Wide Green New Deal is necessary.
We can not rebuild grand economy on the volatile, declining energy base, instead, the world has enough technology and its potential, I suppose.
Thank you !