Europe and the financial crisis dominated the G20 summit in Mexico summed up by the fourth point of their 85 paragraph communique.
“Euro Area members,” it said, “will take all necessary policy measures to safeguard the integrity and stability of the area, improve the functioning of financial markets and break the feedback loop between sovereigns and banks.”
President Barrack Obama said at the conclusion:
“Our friends in Europe clearly grasped the seriousness of the situation and are moving forward with a heightened sense of urgency. I welcome the important steps they have taken already to promote growth, financial stability and fiscal responsibility. None of them are going to be a silver bullet that solves this thing entirely over the next week or two weeks or two months, but each step points to the fact that Europe is moving towards further integration rather than break-up.”
Coded language to perhaps once again underline Europe’s financial woes are continuing to impact beyond the continent. Europe is Washington’s main trading partner and it is election year in the U.S.
So how will the agreement in the form of words at the end of the summit translate into action, how and when will it come and can there be a united approach as time is in danger of running out.
“We Europeans, have set ourselves three common goals which we will convey to the EU summit at the end of the month. They are growth, financial stability and fiscal responsibility,” said
President Francois Hollande.
Chancellor Angela Merkel and the French President agreed at the summit in Mexico to accelerate moves towards creating a banking union between the 17 countries that use the single currency while she continues to call for political union.
“I have from my side once again made it clear that we need more Europe, expect a deepening of our cooperation, because the markets are moving together,” said Angela Merkel.
Analysts predict financial markets will face a tense few days to see whether the euro zone will be able to flesh out the details of the agreement struck at the G20 to drive down borrowing costs for debt-laden countries in the region.
World leaders await the EU summit to check whether Europe will keep its commitments to the international community.