All but two European Union member countries have agreed on new fiscal rules designed to ensure there is not another regional debt crisis, and to regain the confidence of the financial markets.
The 27 European Union heads of government came to Brussels to finalize what is called the “fiscal compact” to avoid future crises, and to find ways to promote economic growth to lift their countries out of the current one.
The accord, which sets strict rules for government budgets, was approved by 25 of the leaders and is to be signed in March. Britain and the Czech Republic did not join the accord. Britain says it would take away too many powers it has to regulate its own economy.
The European leaders have been the targets of much criticism for not doing enough quickly enough to address the debt crisis and accompanying economic downturn. But the president of the European Commission, Jose Manuel Barroso, said the continent's effort is on track.
“We have a strategy, and we are staying the course,” Barroso said.
His colleague, European Council President Herman Van Rompuy, said he is not concerned that the two countries did not join the new agreement, saying the 17 that use the common euro currency and other interested countries must be able to work on their problems, even if the EU is not unanimous on the approach.
“With this treaty we maintain as much as possible the unity of the union, taking into account that those who have a common currency have the possibility to deal with the problems linked to their currency,” Van Rompuy said.
The European leaders also took several steps designed to stimulate economic growth, launching programs to help small businesses and to create jobs, particularly for young people. But they acknowledge the effort is difficult at a time when most countries do not have enough money to directly create jobs or stimulate economic growth.
The head of the Brussels-based research organization Friends of Europe, Giles Merritt, says European leaders and their people still have not faced up to the fundamental challenge before them.
“I don't think they've got very good marks from anybody. We all know Europe has been living beyond its means. There has to be a complete sort of restructuring of European society. We all know that. What we don't know is how to do it," Merritt said.
Merritt says European countries can no longer afford the generous social programs they provide to their people, but spending cuts to reduce or eliminate those programs are hugely unpopular.
Monday's summit coincided with a general strike in Belgium, called to protest that government's austerity plans. Merritt says more such actions, what he called “social sulking,” lie ahead as Europe faces a summer of slow growth or recession.
Meanwhile, one of Europe's most troubled economies, Greece, moved closer to agreement with creditors to restructure its debt, and default on part of it. A deal is expected within days, although Greek leaders rejected calls for EU officials to be given veto power over their future budgeting decisions.