News / Europe

European Debt Crisis Summit Starts

British Prime Minister David Cameron, center, speaks with the media as he arrives for an EU summit in Brussels, Dec. 8, 2011.
British Prime Minister David Cameron, center, speaks with the media as he arrives for an EU summit in Brussels, Dec. 8, 2011.

European leaders have started a two-day summit in Brussels in the latest effort to resolve the continent's debt crisis and save the euro.

Some officials have described the European summit as a moment of reckoning for the common currency, under siege by Europe's burgeoning debt crisis.  But before the meeting opened Thursday night, there remained a divergence of opinion on exactly how to resolve the two-year debt contagion that threatens the stability of the world economy.

U.S. President Barack Obama told reporters in Washington that Europe is prosperous enough to resolve the debt crisis if its leaders have the political will to act.

"Europe is wealthy enough that there is no reason why they can't solve this problem," said President Obama. "It is not as if we are talking about some impoverished country that doesn't have any resources and is being buffeted by the world markets and they need to come hat in hand and get help.  This is Europe with some of the wealthiest countries on earth, collectively one of the largest markets on earth, if not the largest."

The economy in the 17-nation bloc that uses the euro has all but stalled, with some analysts saying it has already dipped into a recession. The European Central Bank took a modest step ahead of the summit to boost lending, trimming its prime interest rate a quarter percentage point to one percent, the second cut in two months.

But stocks slid on European and U.S. exchanges after the bank's president, Mario Draghi, dampened speculation that the central bank would increase its purchase of the debt of European governments as one way to cut their borrowing costs. A European regulator said the continent's banks need to raise nearly $154 billion to cover possible losses on government securities they hold.

German Chancellor Angela Merkel and French President Nicolas Sarkozy are calling for the eurozone nations to curb excessive spending and impose strict penalties on violators.  Their plan would also create a unified corporate tax rate and a new financial transaction tax.

President Sarkozy said an agreement is essential.

"Everyone can understand that if on Friday we don't find an agreement, there is no second chance," said President Sarkozy. "I call for the spirit of compromise and speedy decision making."

Before heading to Brussels, the German and French leaders tried to rally support for their plan during a meeting of the center-right European People's Party in the French city of Marseilles. Senior officials said late Wednesday that final agreement may not be reached at the summit.  

One German official told the Associated Press that it might be Christmas (December 25) before a deal is reached.  Another senior official was quoted as saying that some countries "have not understood the seriousness of the situation.

Fears that Europe's debt crisis could spark additional problems have sent jitters through the global financial markets and have prompted warnings from several top credit rating agencies.

Britain, which has its own currency, the pound, has indicated that it may not be willing to sign on to new EU treaty provisions.  Prime Minister David Cameron said earlier this week that he will defend Britain's financial interests at the summit.

Some information for this report was provided by AP, AFP and Reuters.

You May Like

800-Pound Man Determined to Slim Down

Man says he was kicked out of hospital for ordering pizza; wants to be an actor More

Australia Prepares to Resettle 12,000 Syrian Refugees

Preference will be given to refugees from persecuted minorities, and the first group is expected to arrive before late December More

S. African Miners Seek Class Action Suit Against Gold Mines

The estimated 100,000 say say they contracted the lung diseases silicosis and tuberculosis in the mines More

This forum has been closed.
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Amnesty Accuses Saudi Coalition of ‘War Crimes’ in Yemeni
Henry Ridgwell
October 12, 2015 4:03 PM
The human rights group Amnesty International has accused the Saudi-led coalition of war crimes in airstrikes against Houthi rebels in Yemen. Henry Ridgwell reports the group says hundreds of civilians have been killed in strikes on residential areas.

Video Amnesty Accuses Saudi Coalition of ‘War Crimes’ in Yemen

The human rights group Amnesty International has accused the Saudi-led coalition of war crimes in airstrikes against Houthi rebels in Yemen. Henry Ridgwell reports the group says hundreds of civilians have been killed in strikes on residential areas.

Video No Resolution in Sight to US House Speaker Drama

Uncertainty grips the U.S. Congress, where no consensus replacement has emerged to succeed Republican House Speaker John Boehner after his surprise resignation announcement. Half of Congress is effectively leaderless weeks before America risks defaulting on its national debt and enduring another partial government shutdown.

Video New Art Exhibit Focuses on Hope

Out of struggle and despair often comes hope. That idea is behind a new art exhibit at the American Visionary Art Museum in Baltimore, Maryland. "The Big Hope Show" features 25 artists, some of whom overcame trauma and loss. VOA’s Deborah Block reports.

Video Columbus Day Still Generates Controversy as US Holiday

The second Monday of October is Columbus Day in the United States, honoring explorer Christopher Columbus and his discovery of the Americas. The achievement is a source of pride for many, but for some the holiday is marked by controversy. Adrianna Zhang has more.

Video Anger Simmers as Turks Begin to Bury Blast Victims

The Turkish army carried out new air strikes on Kurdistan Workers Party (PKK) targets on Sunday, a day after the banned group announced a unilateral cease fire. The air raids apparently are in retaliation for the Saturday bombing in Turkey's capital Ankara that killed at least 95 people and wounded more than 200 others. But as Zlatica Hoke reports, there are suspicions that Islamic State is involved.

Video Bombings a Sign of Turkey’s Deep Troubles

Turkey has begun a three-day period of mourning following Saturday’s bomb attacks in the capital, Ankara, that killed nearly 100 people. With contentious parliamentary elections three weeks away, the attacks highlight the challenges Turkey is facing as it struggles with ethnic friction, an ongoing migrant crisis, and growing tensions with Russia. VOA Europe correspondent Luis Ramirez reports.

Video Afghanistan’s Progress Aided by US Academic Center

Recent combat in Afghanistan has shifted world attention back to the central Asian nation’s continuing civil war and economic challenges. But, while there are many vexing problems facing Afghanistan’s government and people, a group of academics in Omaha, Nebraska has kept a strong faith in the nation’s future through programs to improve education. VOA’s Greg Flakus has more from Omaha, Nebraska.

Video House Republicans in Chaos as Speaker Favorite Withdraws

The Republican widely expected to become the next speaker of the House of Representatives shocked his colleagues Thursday by announcing he was withdrawing his candidacy. The decision by Majority Leader Kevin McCarthy means the race to succeed retiring Speaker John Boehner is now wide open. VOA National Correspondent Jim Malone reports.

Video German, US Officials Investigate Volkswagen

German officials have taken steps to restore some of the reputation their car industry has lost after a recent Volkswagen diesel emissions scandal. Authorities have searched Volkswagen headquarters and other locations in an effort to identify the culprits in the creation of software that helps cheat on emission tests. Meanwhile, a group of lawmakers in Washington held a hearing to get to the bottom of the cheating strategy that was first discovered in the United States. Zlatica Hoke reports.

Video Why Are Gun Laws So Hard for Congress to Tackle?

Since taking office, President Barack Obama has spoken out or issued statements about 15 mass shootings. The most recent shooting, in which 10 people were killed at a community college, sparked outrage over the nation's gun laws. But changing those laws isn't as easy as many think. VOA's Carolyn Presutti reports.

Video In 'He Named Me Malala,' Guggenheim Finds Normal in Extraordinary

Davis Guggenheim’s documentary "He Named Me Malala" offers a probing look into the life of 18-year-old Malala Yousafsai, the Pakistani teenager who, in 2012, was shot in the head by the Taliban for standing up for her right to education in her hometown in Pakistan's Swat Valley. Guggenheim shows how, since then, Malala has become a symbol not as a victim of brutal violence, but as an advocate for girls’ education throughout the world. VOA’s Penelope Poulou has more.

Video Paintable Solar Cells May Someday Replace Silicon-Based Panels

Solar panels today are still factory-manufactured, with the use of some highly toxic substances such as cadmium chloride. But a researcher at St. Mary’s College, Maryland, says we are close to being able to create solar panels by painting them on a suitable surface, using nontoxic solutions. VOA’s George Putic reports.

VOA Blogs