EU reaches deal on economy, climate and Lisbon Treaty

BRUSSELS – EU leaders sealed an agreement Friday for a plan worth EUR 200 billion designed to dig Europe out of recession and a package to combat global warming on the final day of a crunch summit in Brussels.

After persuading Ireland to submit a stalled EU reform treaty to a second referendum next year, the 27 leaders agreed to club together to fund an economic stimulus package and make major cuts in greenhouse gas emissions.

"We are starting to change the way we do things in Europe – talking less and doing more," French President Nicolas Sarkozy, who chaired the gathering, told a post-summit press conference.

With much of Europe in recession, there had been expectations the climate package could unravel as member states baulk at the extra costs involved.

But Sarkozy said that there had been unanimous agreement on the need for an "historic" climate package he said should inspire the rest of the world.

"No continent has given itself such binding rules that we have adopted with unanimity," he said.

The EU’s climate-energy package, the "20-20-20" deal, seeks to decrease greenhouse gas emissions by 20 percent by 2020, make 20 percent energy savings and bring renewable energy sources up to 20 percent of total energy use.

Sarkozy denied the targets had been watered down amid calls by several states for amendments to the initial package at a time of recession.

"The objectives remain the same," he said. "No way can the (economic) crisis be used as an excuse not to move on the environment."

But environmental groups, including Greenpeace and WWF, slammed the deal, saying too many concessions had been made to industry and poorer eastern European nations with their highly-polluting coal-fired power generators.

"European heads of state and government have reneged on their promises and turned their backs on global efforts to fight climate change," they said in a joint statement.

Unveiling the package in January, European Commission chief Jose Manuel Barroso put the cost of meeting the targets by 2020 as at least EUR 100 billion – the equivalent of around three euros a week for every European.

Czech President Vaclav Klaus, whose country takes over the EU presidency from France in January, criticised the package as a "silly luxury".

"We should have been able to discuss it during our presidency, to force it now is not very good," said Klaus, whose prime minister agreed to the package.

Although the climate change deal was only nailed down after protracted negotiations, leaders said there had been an overwhelming consensus on the need for a joint assault on the economic slowdown.

"Everybody was on the same line about the need for a recovery plan," said Sarkozy. "Exceptional situations need exceptional measures."

An eve of summit interview by German Finance Minister Peer Steinbrueck, who ridiculed the idea of "tossing around billions" to fend off recession, had indicated that the rescue package would prove a major bone of contention.

But British Prime Minister Gordon Brown, whose "breathtaking" 20-billion-pound (EUR 22.4 billion) stimulus package was singled out by Steinbrueck, said the agreement was a riposte to those who say "do nothing".

"We will continue to reject the do-nothing approach and we will not stand by and let the recession take its course," Brown told reporters.

Under the stimulus plan, member countries would pump on average the equivalent of 1.5 percent of gross domestic product (GDP) into their economies in order to temper the impact of a global recession.

Leaders also adopted a deal to pave the way for Ireland to stage a second referendum on a stalled package of key reforms, the Lisbon Treaty which was rejected by Irish voters in June.

Irish Prime Minister Brian Cowen said he was prepared to call a new referendum as long as promised guarantees are delivered.

"I have said that I would be prepared to return to the public with a new package and seek their approval of it," he told reporters.

"Today we have the clear evidence the European Union is ready to respond" to the concerns displayed by the Irish people in the June plebiscite.

Under the deal, Ireland would try to hold a new referendum by November 2009 in exchange for guarantees on key issues including an assurance that it does not lose its EU commissioner.

[AFP / Expatica]