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Europe

EU Leaders Unite on Climate Plan and Lisbon Treaty

European Union leaders have approved a set of laws on fighting climate change, a plan for rescuing the economy from recession and a way out of the impasse caused by Ireland's rejection of the Lisbon treaty.

German Chancellor Angela Merkel speaks with British Prime Minister Gordon Brown

Merkel and Brown can celebrate coming to an agreement

"This is historic what is happening here. You will not find another continent in the world that is giving itself such binding targets" on climate change, French President Nicolas Sarkozy, who chaired the summit in Brussels, said Friday, Dec. 12.

"Europe has passed its credibility test. We mean business when we speak about climate," European Commission chief Jose Manuel Barroso said.

Key to clinching a climate deal on Friday was an agreement to boost the funding of experimental power stations which would pump their greenhouse gases underground, officials close to the talks told DPA news agency.

Sarkozy had proposed gifting such stations 200 million permits to emit carbon dioxide (CO2, the main greenhouse gas). But after Britain objected, that figure was raised to 300 million -- a cash value of 4.5 billion euros ($5.9 billion) at current prices.

Sarkozy had already won Poland's support by promising that Polish power stations would get a substantial free allowance of CO2 permits until 2020, and German and Italian approval by promising to give free permits to any industries threatened by competition from countries with less stringent climate-protection laws.

Finance plan also agreed

A stock broker buries his head in his hands in front of the DAX in Frankfurt in October, 2008

Is economic relief on the way now a plan has been agreed?

The meeting also approved a plan by the European Commission to give the EU's economy a boost equivalent to "about 1.5 percent" of total economic output -- weakening an earlier French call for it to be "at least" 1.5 percent.

"Everybody has agreed that this is a very serious crisis. Everybody agrees that there is a need for an economic recovery on the basis of the (Commission) plan," Sarkozy said.

However, EU leaders rejected a Franco-British call for member states to cut VAT on green goods and labor-intensive services such as restaurants, postponing the debate until a meeting of finance ministers in the spring.

Strategy aligned for Ireland

The leaders also agreed to an Irish plan aimed at winning popular support for the EU's reforming Lisbon Treaty, which Irish voters rejected in a referendum in June.

Following a report from Irish Prime Minister Brian Cowen, they promised to guarantee Ireland's independence on questions of tax, abortion and neutrality.

They also vowed that every member state would always be allowed to nominate a member of the Commission -- if the Irish government tries to ratify the treaty by the end of October 2009.

The guarantees to Ireland can be made legally binding by writing them into a treaty for Croatia's accession to the EU in 2010 or 2011, he said.

Cowen applauded the guarantees, saying he was prepared to call a new referendum for the Lisbon Treaty.

"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 after the summit.

Irish Prime Minister Brian Cowen

Cowen has received a set of EU guarantees

Sarkozy confirmed this move. "The Lisbon process is relaunched. The Irish will be consulted again ... If all member states ratify the treaty, then every member state will have a commissioner," Sarkozy said.

Following the summit, EU Commission President Barroso also called on President Elect Barack Obama to join Europe in its bold steps towards repariing the economy and climate change.

"Let us now build a transatlantic recovery plan and transatlantic climate and energy partnership," he said

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