Britain, France, Germany and Italy have called for an international conference “as soon as possible” to consider sweeping reforms of the global finance system.
The move was announced after an emergency summit in Paris at which Prime Minister Gordon Brown and the leaders of France, Germany and Italy vowed to lead
the way in restoring confidence and stability in the European economy - and urged the rest of the world to do the same.
They want the international conference to be convened before the end of next month, and its task, said French President Nicolas Sarkozy, would be to revive the current finance system set up at the Bretton Woods Conference 60 years ago, which created the International Monetary Fund and the World Bank.
President Sarkozy called the three-and-a-half hour conference to bring together the four EU countries which belong to the G8 group of most industrialised countries.
But the summit’s pledges on restoring sound financial systems will be looked at again next week by finance ministers from all 27 EU member states at talks in Luxembourg.
President Sarkozy, who currently holds the EU presidency, also vowed to continue a series of private meetings with various EU leaders to push the message that continued close co-operation is needed to regulate banks and finance houses and restore consumer confidence.
Before leaving London for Paris, Mr Brown announced a new national scheme, setting up a multi-billion pound fund available to small and medium-sized businesses facing trouble because of the global economic turmoil.
And in Paris he joined the others in insisting that member states should continue with their own national regimes of financial regulation - but overseen by the European Commission’s strict rules on fair competition and against illegal state aid.
A summit declaration included a pledge to step up cooperation in Europe to restore sound financial markets, including a pledge to “take all the necessary measures” to achieve the goal.
The statement welcomed action already taken by the European Central Bank, the Bank of England and other European central banks since the start of the crisis.
“The liquidity of the financial system shall be insured by all authorities in order to preserve confidence and stability,” said the statement.
The four leaders vowed to work with the rest of the EU and Europe’s international partners to: “Achieve an effective and comprehensive reform of the global financial system in line with the principles of transparency, sound banking, responsibility, integrity, and global governance.”
Mr Brown said afterwards that he was sure others would share the wish to meet those five principles.
“We agreed that we must do more to co-ordinate our responses, including calling an international meeting where we will put the five principles,” said Mr Brown. “I believe the co-operation we are now showing across Europe will be repeated across the world.”
Before the summit there had been French suggestions of setting up a multi-billion pound central financial reserve, funded by all 27 EU countries, which will be used in emergencies to bail out ailing banks - similar to the $700 billion fund just approved in America.
The idea met with a cool reception, particularly in the UK and Germany, and President Sarkozy denied ownership of the suggestion.
Instead he concentrated on pushing the plan to tighten banking regulation, the monitoring of credit rating agencies and the reinforcement of EU competition and state aid rules designed to ensure a level playing field between banks and finance houses. He said the aim now was to work on behalf of consumers, and not speculators.
Meanwhile, Mr Brown said that the UK Government would continue to do whatever was necessary, just as he had already acted to save Northern Rock and Bradford & Bingley.
“We had to do it. We have done what was necessary and will continue to do what is necessary to preserve the financial system.”
The President of the European Commission, Jose Manuel Barroso, who was also at the talks, welcomed what he called a: “Spirit of co-operation and willingness” in the EU and a consensus about what needed to be done. “This will reinforce stability and confidence,” he said.