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EU rallies behind banking reform EU rallies behind banking reform
(41 minutes later)
All 27 EU states broadly support the bank rescue plan proposed for the bloc and the holding of a world finance summit, France's president has said.All 27 EU states broadly support the bank rescue plan proposed for the bloc and the holding of a world finance summit, France's president has said.
Nicolas Sarkozy, whose country currently chairs the EU presidency, was speaking at the EU summit in Brussels.Nicolas Sarkozy, whose country currently chairs the EU presidency, was speaking at the EU summit in Brussels.
The heads of the G8 top industrialised nations also backed holding a summit with other non-member states on global financial reform.The heads of the G8 top industrialised nations also backed holding a summit with other non-member states on global financial reform.
UK PM Gordon Brown has called for the IMF to be rebuilt.UK PM Gordon Brown has called for the IMF to be rebuilt.
Shares across the world fell sharply on Wednesday amid fears of recession.Shares across the world fell sharply on Wednesday amid fears of recession.
The Dow Jones index in New York sank nearly 8% and shares in Brazil by 10%. There were sharp falls in London and on other European markets.The Dow Jones index in New York sank nearly 8% and shares in Brazil by 10%. There were sharp falls in London and on other European markets.
'New Bretton Woods"'New Bretton Woods"
Eurozone leaders agreed at the weekend on a comprehensive package designed to shore up banks, including making more than a 1,000bn euros ($1,366bn) available for interbank loans.Eurozone leaders agreed at the weekend on a comprehensive package designed to shore up banks, including making more than a 1,000bn euros ($1,366bn) available for interbank loans.
There's also a concern that the EU may water down its commitment to the free market, with talk of punishing fat cats and increasing regulation The BBC's Mark Mardell writing in his blog Mardell's EuropeThere's also a concern that the EU may water down its commitment to the free market, with talk of punishing fat cats and increasing regulation The BBC's Mark Mardell writing in his blog Mardell's Europe
"The whole of Europe, without exception, approves the measures adopted on Sunday in Paris," Mr Sarkozy said."The whole of Europe, without exception, approves the measures adopted on Sunday in Paris," Mr Sarkozy said.
But he added that EU states had not yet reached a definitive agreement on the text of the banking agreement.But he added that EU states had not yet reached a definitive agreement on the text of the banking agreement.
Mr Sarkozy said the EU wanted to launch "a new Bretton Woods summit" in November, referring to the 1944 meeting which led to the creation of the International Monetary Fund and other global institutions.Mr Sarkozy said the EU wanted to launch "a new Bretton Woods summit" in November, referring to the 1944 meeting which led to the creation of the International Monetary Fund and other global institutions.
China and India needed to be involved in the discussions, he said, adding: "We're moving towards a G8 plus - the crisis is so great that it needs to include the whole world."China and India needed to be involved in the discussions, he said, adding: "We're moving towards a G8 plus - the crisis is so great that it needs to include the whole world."
In a joint statement on Wednesday, the leaders of the G8 countries - the US, UK, France, Italy, Germany, Canada, Japan and Russia - said that changes had to be made to the "regulatory and institutional regimes for the world's financial sectors to remedy deficiencies exposed by the current crisis".In a joint statement on Wednesday, the leaders of the G8 countries - the US, UK, France, Italy, Germany, Canada, Japan and Russia - said that changes had to be made to the "regulatory and institutional regimes for the world's financial sectors to remedy deficiencies exposed by the current crisis".
"We look forward to a leaders' meeting with key countries at an appropriate time in the near future to adopt an agenda for reforms to meet the challenges of the 21st Century," the statement added."We look forward to a leaders' meeting with key countries at an appropriate time in the near future to adopt an agenda for reforms to meet the challenges of the 21st Century," the statement added.
Gordon Brown told the BBC that global action was needed to deal with the financial crisis, and he predicted a summit would be held within weeks.Gordon Brown told the BBC that global action was needed to deal with the financial crisis, and he predicted a summit would be held within weeks.
Climate row
Mr Sarkozy was also pushing hard at the Brussels summit, which ends on Thursday, for an agreement on climate change and energy action by the end of the year.
We'll strive to find a good compromise [on climate change] within two and a half months Nicolas SarkozyFrench president Nations challenge EU climate plan
This was vital, he said, if Europe was to maintain its leadership on the world stage.
With a recession looming, Italy and Poland are threatening to block the climate change package, which they say is a burden for industry.
"I'm not giving up on the timetable," said Mr Sarkozy. "We'll strive to find a good compromise within two and a half months."
In other summit business, talks on a new EU-Russia partnership treaty were postponed, amid continuing concern about Russia's military presence in Georgia. There were divisions about when to resume them.
A decision to revive the failed Lisbon treaty, meant to give the EU more stable institutions in difficult times, is expected to be put on the back-burner until December.
Irish Prime Minister Brian Cowen promised to come up with an action plan by then on the best way to move ahead next year.