US and Europe Union leaders have agreed to meet at the weekend to prepare for a global summit to overhaul the world's financial system, while fears of global recession continued to rattle markets.
French President Nicholas Sarkozy, currently representing the EU on the world stage, said at an EU summit in Brussels he would meet US President George W Bush on Saturday. "If we can bring co-ordinated answers to the financial crisis, can we not bring coordinated answers to the economic crisis?" Mr Sarkozy asked.
British Prime Minister Gordon Brown said the EU leaders had agreed on the need to reform the international financial system as the world faced its worst financial crisis in 80 years.
The push for and overhaul of the global financial system is aimed at preventing a repeat of the credit crunch that sparked the biggest stock-market selloff since the Great Depression. It would be the first such summit since the 1944 Bretton Woods accord that paved the way for Europe's post-World War II reconstruction and set up the institutions that oversee the world economy today.
“We had the emerging market crisis, we had the Internet bubble, now we have this massive crisis,” Mr Sarkozy told reporters late last night in Brussels. Europe insists on the “re-foundation of the international financial system.”
The European initiative is likely to face some resistance from the US, which has used its dominance of international financial institutions to promote a brand of capitalism that has come into at least temporary disrepute.
“The US got what it wanted in 1944 and, I suspect, will do so again simply because the Europeans won't be able to decide what they want,'' said Martin Weale, director of the National Institute of Economic and Social Research in London.
Mr Bush “definitely” favors holding a Group of Eight meeting before the end of the year, White House spokesman Tony Fratto said in Washington.
European governments pressed for a wider summit, including leaders of developing economies such as China, India, Brazil and South Africa. To jumpstart that process, Mr Sarkozy, holder of the EU's six- month presidency, will travel with European Commission President Jose Barroso to the US on Saturday to meet Mr Bush.
Agencies