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EU leaders fail to agree on bailout fund for eastern members

(Xinhua)
Updated: 2009-03-02 08:49

BRUSSELS -- European Union (EU) leaders on Sunday failed to agree on a single multibillion-euro fund to bail out Central and Eastern European members, which are worst-hit by the financial crisis.

European Union leaders pose for a family photo at an emergency EU leaders summit in Brussels, March 1, 2009. They are (L to R, second row) Netherlands' Prime Minister Jan-Peter Balkenende, Luxembourg's Prime Minister Jean-Claude Juncker, Latvia's Prime Minister Ivars Godmanis, Italy's Prime Minister Silvio Berlusconi (L to R, first row) European Parliament President Hans-Gert Poettering, Sweden's Prime Minister Fredrik Reinfeldt, Belgium's Prime Minister Herman Van Rompuy and Poland's Prime Minister Donald Tusk. [Agencies]

"The idea of dividing up (the EU) into new member states, old member states, eurozone countries, non-eurozone countries, north against south, or east against west -- that approach is an approach which we clearly rejected in the European Council (summit)," said Czech Prime Minister Mirek Topolanek, whose country holds the rotating EU presidency.

Topolanek was chairing an extraordinary EU summit devoted to the financial and economic crises.

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European Commission President Jose Manuel Barroso said the leaders agreed to show solidarity with Central and Eastern Europe but rejected the idea of a single bailout fund for them.

"More will be done, but (by) looking at the situation on a case-by-case basis, where there is a real need, but not for a category of countries, because in the European Union, we have 27 member states and the situations are very different," Barroso told a joint press conference with Topolanek.

In the final document of the summit, the leaders said they would review the financial assistance already made available for Central and Eastern Europe, recognizing "clear differences between the member states in Central and Eastern Europe."

Hours before the emergency EU summit, leaders from nine Central and Eastern European countries met separately to work on a common position.

Czech Prime Minister Mirek Topolanek (R), whose country currently holds the rotating EU presidency, talks with European Commission President Jose Manuel Barroso at EU headquarters prior to the special summit in Brussels, capital of Belgium, March 1, 2009. [Xinhua]

Hungarian Prime Minister Ferenc Gyurcsany called for a special EU fund of up to 190 billion euros (US$241 billion) to bail out Central and Eastern European countries.

With the economic situation deteriorating in Eastern Europe, there is a mounting concern that a collapse of Eastern European economies could trigger further instability across the continent.

"We should not allow a new iron curtain to be set up and divide Europe in two parts," Gyurcsany told reporters ahead of the summit.

Hungary was among the worst hit Eastern European countries in the financial crisis. Together with Latvia, the country has been forced to seek financial support from the International Monetary Fund (IMF).

"This is the biggest challenge for Europe in the last 20 years. In the beginning of the nineties we reunified Europe, now the challenge is whether we will be able to reunify Europe financially," Gyurcsany said.

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