EU's eastern nations fear western protectionism

21st February 2009, Comments 0 comments

The EU's crisis-hit eastern member states have decided to hold a mini-summit in Brussels to send a message against protectionism to their richer western partners, officials said Friday.

BRUSSELS - The meeting, a Polish initiative, will take place in Brussels on March 1, just before an extraordinary summit of all 27 EU nations aimed at coordinating rescue efforts in the face of a deepening recession across Europe.

EU Commission chief Jose Manuel Barroso will attend, a spokesman said Friday, along with leaders from nine EU countries that have joined the bloc since 2004 and are just beginning to find their collective voice.

The meeting will be a chance for the eastern partners to rehearse their own positions before the full summit, as tensions rise between the older and newer European Union members, diplomatic sources said.

"We want to send a clear message that we support the European Union's position in favour of defending the common market and that we are against protectionism," Poland's Minister for European affairs Mikolaj Dowgielewicz, told the national PAP new agency.

France in particular has raised hackles in the Czech Republic, which holds the EU's rotating presidency, with comments by French President Nicolas Sarkozy against French automakers producing their cars in the Czech Republic.

The European Commission is now looking into the French auto aid package that aims to retain jobs and assembly lines in France as well as similar measures in Italy and Spain to help the ailing auto industry.

Though Barroso has accepted the invitation to the east European mini-summit on March 1, the European Commission said it was keen to prevent the bloc from fraying along the old Iron Curtain faultline.

"We either swim together or we sink together," a commission spokesman said Friday.

"'Yes' to meetings with different formats, but 'yes' above all to a European solution for all."

The Brussels summit will also be a chance to consider a coordinated aid plan for eastern Europe's hard hit banks.

Austria, whose banks are highly exposed to debt in central and eastern Europe, and Hungary have been spearheading a campaign for EU aid to banks that have run into trouble, but so far without success.

European finance ministers will also mull the problems facing banks in Central and Eastern Europe at a meeting in Berlin on Sunday, a German government source said on Friday.

"Most rich countries in the EU are boosting fiscal spending to mitigate the downturn. But some of the new members are being forced to cut budgets by IMF emergency programmes. In the others, higher public spending cannot make up for falling export demand," said Katinka Barysch from the Centre for European Reform.

The World Bank on Friday urged the European Union's western states not to use recession-fighting measures to shut their ex-communist neighbours out of their markets, saying it could set back two decades of economic progress.

Also Friday the European Commission proclaimed the Union's "big bang" expansion eastwards five years ago to have been a huge success, despite the challenges that the current economic crisis presents.

"Enlargement has served as an anchor of stability, and driver of democracy and the rule of law in Europe," said EU Enlargement Commissioner Olli Rehn, without explaining why he had chosen Friday to hail the achievements of EU expansion rather than May 1, the date it happened.

The nine nations involved in the March 1 mini-summit are Bulgaria, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania and Slovakia. The only central and eastern EU member state not attending is Slovenia.

AFP / Yacine Le Forestier / Expatica

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