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EU urges doubling of IMF capital | |
(about 2 hours later) | |
EU leaders have urged the G20 leading economies to double the money available to the International Monetary Fund to help countries in financial difficulty. | |
Leaders meeting in Brussels said they would provide up to 75bn euros ($102bn; £71bn) in loans in an effort to boost the IMF's capital to $500bn (£344bn). | |
They also doubled to 50bn euros (£47bn; $68bn) the amount of emergency funding available to help non-eurozone members. | |
But the bloc resisted US calls to spend even more to revive national economies. | |
They said they wanted first to gauge the effects of the 200bn-euro ($274bn; £188bn) stimulus package they have been implementing, and that the focus should be on reforming the global financial system. | They said they wanted first to gauge the effects of the 200bn-euro ($274bn; £188bn) stimulus package they have been implementing, and that the focus should be on reforming the global financial system. |
'Voluntary loan' | |
The two-day Brussels meeting took place as the world's biggest economies prepare for the G20 summit in London on 2 April. Trying to outdo one another with promises will certainly not bring any calm to the situation Angela MerkelGerman Chancellor Union chief urges bigger EU pledgeMardell: Dose of German disciplineEU chokes on cost of rescueEurope's jobs evaporate | |
At the end of the talks, EU leaders called on other members of the G20 to double the IMF's resources, saying that co-ordinating international action is critical to "a swift return to sustainable economic growth". | |
Czech Prime Minister Mirek Topolanek, whose country currently holds the EU's rotating presidency, said the bloc was prepared to pay a third of the increased funds for the institution. | |
"If there is a need to help countries which are particularly hit by the crisis, then there is the possibility to help them - 75 billion [euros] is the figure for a voluntary loan to the IMF to act better in the crisis," he told a news conference. | |
Mr Topolanek also announced that they would double to 50bn euros the emergency funding available to member states outside the 16-nation eurozone who were "particularly hit by the crisis". | |
Hungary and Latvia have already received nearly 10bn euros (£9bn) to deal with their balance of payments crises. | Hungary and Latvia have already received nearly 10bn euros (£9bn) to deal with their balance of payments crises. |
Romania is the next member seeking a bail-out and Lithuania is likely to follow suit, the BBC's Oana Lungescu in Brussels says. | Romania is the next member seeking a bail-out and Lithuania is likely to follow suit, the BBC's Oana Lungescu in Brussels says. |
'Deadly idea' | 'Deadly idea' |
Earlier, EU leaders ruled out an extra stimulus package, despite calls from Washington for one. | |
"Trying to outdo one another with promises will certainly not bring any calm to the situation," said German Chancellor Angela Merkel, who has led calls for European fiscal restraint. | "Trying to outdo one another with promises will certainly not bring any calm to the situation," said German Chancellor Angela Merkel, who has led calls for European fiscal restraint. |
Prime Minister Topolanek said on Thursday that the leaders were "unanimous in their views" that they "are going to be prudent" with economy stimulus plans. G20 LONDON SUMMIT World leaders will meet next month in London to discuss measures to tackle the downturn. See class="" href="http://news.bbc.co.uk/2/hi/in_depth/business/2009/g20/default.stm">our in-depth guide to the G20 summit.The G20 countries are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom, the US and the EU. class="" href="/1/hi/business/7921385.stm">Q&A: G20 Summit class="" href="http://newsforums.bbc.co.uk/nol/thread.jspa?forumID=6204">Readers' views | |
He warned that any more deficit spending was "a deadly idea", adding that EU leaders were awaiting the results of the 200bn-euro package for 2009 and 2010 agreed in December. | He warned that any more deficit spending was "a deadly idea", adding that EU leaders were awaiting the results of the 200bn-euro package for 2009 and 2010 agreed in December. |
The European Commission says that if member states' increases in welfare spending are included, the measures total 400bn euros - equivalent to 3.3% of the bloc's gross domestic product. | The European Commission says that if member states' increases in welfare spending are included, the measures total 400bn euros - equivalent to 3.3% of the bloc's gross domestic product. |
But with output tumbling and millions of jobs at risk, EU leaders seem to have few fresh ideas to offer and little appetite to throw more public money at the crisis, our correspondent says. | But with output tumbling and millions of jobs at risk, EU leaders seem to have few fresh ideas to offer and little appetite to throw more public money at the crisis, our correspondent says. |
Mr Barroso also said agreement was also reached on projects to be included in a 5bn-euro ($6.9bn; £4.7bn) package of previously unspent EU budget funds, ending a three-month-long dispute over their allocation. | Mr Barroso also said agreement was also reached on projects to be included in a 5bn-euro ($6.9bn; £4.7bn) package of previously unspent EU budget funds, ending a three-month-long dispute over their allocation. |
He said most of that money would go on energy interconnectors - part of a plan to avoid any repetition of the winter gas crisis that hit much of Central and Eastern Europe in January. | He said most of that money would go on energy interconnectors - part of a plan to avoid any repetition of the winter gas crisis that hit much of Central and Eastern Europe in January. |
A row between Russia and Ukraine over gas prices shut down pipelines and highlighted the need to modernise the EU's energy infrastructure. | A row between Russia and Ukraine over gas prices shut down pipelines and highlighted the need to modernise the EU's energy infrastructure. |
The controversial Nabucco pipeline project, which would bring gas from Central Asia to Central Europe, bypassing Russia, will receive 200m euros ($274m; £188m). Germany had opposed giving the project public money. | The controversial Nabucco pipeline project, which would bring gas from Central Asia to Central Europe, bypassing Russia, will receive 200m euros ($274m; £188m). Germany had opposed giving the project public money. |
Some of the 5bn euros will also be spent on broadband internet connections. Mr Barroso said Hungary would be among the main beneficiaries. | Some of the 5bn euros will also be spent on broadband internet connections. Mr Barroso said Hungary would be among the main beneficiaries. |