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EU Brussels summit to focus on eurozone crisis Sharp divisions over banking union before EU summit
(about 1 hour later)
EU leaders are due to begin a two-day summit in Brussels that will focus on issues surrounding the eurozone crisis.  
High on the agenda will be controversial plans for a eurozone banking union, seen as a key element in restoring confidence in the euro. EU states are sharply divided over plans for banking union as their leaders gather in Brussels for a two-day summit.
In the run-up to the summit, Germany has been urging EU states to consider pooling more economic sovereignty. The aim is to agree first on joint banking supervision, with the European Central Bank playing the lead role.
Meanwhile Greece, which is at the centre of the European debt crisis, is braced for another general strike. But the UK - the EU's main financial centre - wants safeguards to protect the powers of the Bank of England.
It will be its 20th since the debt crisis erupted in the country two years ago. It and the other nine non-euro states are also concerned about voting rights in the proposed banking union.
Talks in Brussels are also expected to focus on banking supervision, stricter fiscal oversight and direct recapitalisation of banks from rescue funds. German Chancellor Angela Merkel has called for the EU to be given clear rights to intervene when member states' national budgets violate the bloc's rules.
The EU's economics commissioner should have the authority to declare a budget "invalid", she told the German parliament in Berlin on Thursday morning.
The summit will take place amid calmer European stock markets than in previous meetings and with less concern over the debt crises in Spain and Greece, analysts say. Her government has proposed a full fiscal union with control at European level of tax and spending.
Speaking on Wednesday, French President Francois Hollande said an end to the eurozone crisis was "very close" and he wanted a deal agreed on the first stage of a banking union. Meanwhile in Greece, the eurozone state worst hit by the debt crisis, a new general strike is getting under way.
German Finance Minister Wolfgang Schaeuble has proposed a full fiscal union - control at European level of tax and spending. 'Quality before speed'
On Wednesday, Mr Schaeuble added that eurozone countries "need to tackle problems themselves", adding that the eurozone bailout fund was there to help countries do just that. The summit is taking place amid calmer European stock markets than at previous meetings and with less concern over the debt crises in Spain and Greece, analysts say.
However, the banking union proposal has brought urgency to the talks, with the EU's executive Commission, the ECB and several states including Spain and France wanting its legal basis to be in place by January.
Germany, while advocating greater fiscal control, is urging caution, with Mrs Merkel repeatedly stressing that "quality must trump speed".
A top German official, who spoke to the Associated Press news agency on condition of anonymity, said many "legal, technical and political details" for a supervisory authority had still to be hammered out.
On Wednesday, German Finance Minister Wolfgang Schaeuble said eurozone countries "need to tackle problems themselves", adding that the eurozone bailout fund was there to help countries do just that.
But he reiterated his view that further steps towards political integration would strengthen the bloc.But he reiterated his view that further steps towards political integration would strengthen the bloc.
The meeting in Brussels will be the fourth time that leaders of the EU's 27 nations have met this year. While the 17 eurozone states largely support the proposal for a banking union, the remaining 10 are uneasy that their banks might face new regulation without their say-so.
Borrowing costs for struggling eurozone economies have fallen sharply since the European Central Bank (ECB) announced last month that it was prepared to buy their bonds in unlimited amounts under strict conditions. The BBC's Gavin Hewitt says little will be agreed at the summit.
The BBC's Gavin Hewitt says the calmer economic climate is being used to discuss buttressing economic and monetary union, and little will be agreed at this summit. It is the fourth time that the leaders of the EU's 27 nations have met this year.
On Wednesday, Greece and its international creditors are said to have reached a deal on austerity measures needed before its next bailout instalment. Other business expected to come up at the summit includes relations with China and the situation in Syria, Iran and Mali.
Nevertheless, large demonstrations are planned across the country against the next package of spending cuts.
Taxi drivers, ferry workers, doctors, teachers and air traffic controllers are among those taking part in a general strike across the public and private sectors.