EU seeks agreement on crisis-busting aid package

EU countries are still trying to find consensus on a plan to launch a package to stimulate economic growth worth a reported 130-billion euros.

Details of the plan will not be released until next week, but Germany said the European Commission will ask member states to contribute about 1 per cent of their gross national product to fight recession, brought on by the financial crisis.

Angela Merkel’s government wants the package to be a co-ordinated summary of national stimulus programmes, rather than a top-up which would need governments to contribute new funds.

The German Chancellor said: “I am very optimistic that we will, for the good of the employees, succeed in developing a unified action which we will then implement nationally, plus there will be some combined efforts, like granting loans by the European Investment Bank.”

One report says that could involve a 2-billion EIB contribution for the EU’s struggling car manufacturers, who have already started cutting jobs.

But according to some, that is only a fraction of what is needed.

The head of Ford in Germany said the industry needs 40-billion in loans to help meet EU demands on making cars more efficient and environmentally friendly.

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