Europe’s leaders vow to fight financial crisis

The leaders of Europe’s four biggest economies have pledged to work together to stabilise the continents financial sector – but they’ve stopped short of US style bail-out.

French President Nicolas Sarkozy hosted the mini-summit with leaders from Britain, Germany and Italy all at the table. They were there to help overcome the mayhem that’s pushed several European banks to the brink of collapse.

German Chancellor Angela Merkel said: “The lesson learnt from this financial crisis is to hold on the one hand those responsible to account and on the other to decide on the rules and measures to avoid a future crisis like this happening again”

French President Nicolas Sarkozy announced Europe’s leaders may seek a possible breach of strict EU limits on the amount of money individual states can borrow.

“Given the exceptional economic and financial circumstances of the crisis the European Commission must be flexible in applying state aid to businesses according to the principles of the single market,’‘ said the French President.

Under present rules EU states must keep budget deficits below 3 percent of their Gross Domestic Product.

If approved, it will be the first time Europe allows member states to bend rules on how much they can spend.

This week, several European states have pumped billions of euros into the financial system to keep banks and companies afloat.

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