The leaders of the European Union at a two-day summit have agreed in principle to provide more for the International Monetary Fund – some 54 billion euros – as the EU’s contribution to helping the global economy back on its feet. They defended stimulus packages already under way, after the US had called for more.
The head of the European Commission, José Manuel Barroso, said the meeting was strong on European unity: “There was a real willingness of solidarity, on concret aspects. One country said, ‘I have not enough for this project!’ And immediately, spontaneously (came): ‘Ok, let’s help this one.’” There was also an agreement in principle to spend 5 billion euros not used from previous EU budgets towards energy infrastructure. The Commission, further, proposed doubling to 50 billion euros an emergency EU fund to ease concern over the economies of central and eastern Europe. This is not final. There will be more discussion in Brussels this Friday. But the President of the Party of European Socialists, Poul Nyrup Rasmussen, said all this is nowhere near enough: “We are far from delivering what we should deliver on the recovery plan. The IMF has said to us and the world, each region, each nation need to invest 2% more to the GDP than you otherwise would do this year, and 2% more next year. We are investing this year around half of it in real demand term. So really this European Union needs to do more.” The 27-member bloc is working on what position to take at a G20 meeting, two weeks away. While giving stimulus injections time to act, the Europeans are calling for stronger global financial regulation.