EU debt crisis summit: live report

October 26, 2011 8:20 AM49 commentsViews: 9

EU debt crisis summit: live report

1555 GMT: There’s mixed reaction from closing European stock markets after a day of choppy trade.

In Paris, the CAC-40 slipped 0.15 percent to 3,169.62 points and in Frankfurt the DAX 30 fell 0.51 percent at 6,016.07 points.

In London, the FTSE-100 index of top companies closed up 0.50 percent at 5,553.24 points.

There’s currently a spectacular rainbow over the city’s financial district, but maybe that’s a coincidence.

1550 GMT: Elsewhere in Europe, Latvian Finance Minister Andris Vilks says his country is on track to meet its 2014 target for adopting the euro.

Without referring to the debt crisis and the last ditch efforts to resolve it, Vilks said that inflation, one of the tests for bloc entrants, was seen as a concern but it was unlikely to upset Latvia’s plans.

“I feel that we will technically meet the criteria and we will be able to react if inflation grows,” said Vilks, whose austerity-focused government was sworn in for a new term yesterday.

1547 GMT: “Our challenge today is not simply to save euro” but to “safeguard the ideals we cherish so much in Europe” post-World War II, Papandreou says.

1545 GMT: The summit is about “saving the euro”, Greek Prime Minister George Papandreou says on arrival.

1542 GMT: A steady stream of leaders and officials arriving at the EU’s Justus Lipsius building in Brussels now.

1530 GMT: Cameron, who on Monday saw 79 of his Conservative lawmakers defy his orders to vote against a referendum on continued British membership of the EU, had fought for non-eurozone member states like Britain to be given a place at the summit.

“Some of the issues we will be discussing this afternoon are directly relevant to Britain in terms of strenghthening banks across Europe,” he said, referring to negotiations both to write down scores of billions of euros in Greek debt and recapitalise the sector.

The London vote took place against a backdrop of intense negotiations on the eurozone debt crisis, which prompted French President Nicolas Sarkozy to criticise Cameron for interfering in the currency bloc’s business during a stormy first Brussels summit on Sunday.

1520 GMT: On the forex markets, the euro hit a seven-week dollar high this afternoon. At 1315 GMT, the European single currency hit $1.3975, the highest level since September 8. But soon afterwards it sank as low as $1.3865 in volatile trade. That compared with $1.3904 in New York late on Tuesday.

1517 GMT: British Prime Minister David Cameron has also arrived, citing “British interests”.

“I’m very glad to be here because it is in British interests that we actually solve this crisis,” Cameron has told reporters. “But in any event, we need to have the greatest possible support for the most comprehensive solution possible and that’s what we will be discussing tonight.”

1515 GMT: “In any case, we are all coming here with the aim of achieving great progress,” Merkel adds.

She also acknowledged that all details might not be worked out by the end of the summit, despite an initial bid to agree a grand plan to contain the crisis which could then be presented at the G20 summit next week in France.

1507 GMT: German Chancellor Angela Merkel has arrived. “There are still many problems to settle and negotiations to carry out, so the work is not yet over,” she tells reporters.

1500 GMT: Welcome to AFP’s live coverage of events in Brussels, where European leaders are holding a crucial summit on the eurozone debt crisis.

With an hour to go before the summit opens, we’ll bring you live updates from Brussels and reaction from around the world.

Here’s a summary of key recent developments:

- Hopes are dimming that the gathering of European presidents and prime ministers will come up with a watertight deal to ward off fears of global recession.

- Draft conclusions leaked ahead of the talks show no deal on a figure for recapitalisation needs of banks. Finance ministers had given broad agreement to a 108-billion-euro ($150 billion) recapitalisation tab last week.

- Senior diplomats have warned that negotiations with banks on a big write-down of Greek debt are proceeding slowly and that plans to boost Europe’s bailout fund remain unclear.

- But China has injected a note of hope that the eurozone may be able to beef up the fund — which currently stands at 440 million euros — to more than a trillion euros, which would enable it to rescue large economies such as Italy and Spain. Top EU diplomats tell AFP that China has agreed to invest in the European Financial Stability Facility (EFSF), a clear signal that attempts to solve the eurozone crisis are truly global.

- Russia has also offered to help boost the size of the bailout fund by acting with other countries through the International Monetary Fund.

- Global powers, from the United States to Japan and China, have pressed European leaders for a lasting solution to the debt crisis, ahead of the G20 summit in France on November 3 and 4.

- The spotlight will be firmly on Italian Prime Minister Silvio Berlusconi, who was told by his peers after a first summit on Sunday to return to Brussels with proof of rapid action to cut a debt mountain six times the size of that in Greece.

- Italian media report that Berlusconi has brought a 15-page letter outlining plans for reforms — including a last-minute agreement with his Northern League coalition partner to raise the retirement age from 65 to 67 in 2026 — with him to Brussels today.

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