Pressure on for European leaders to reach deal
BRUSSELS -- Europe's leaders gather in Brussels under mounting pressure to soften their tough-love approach to the weaker economies among them. With Greece locked in political chaos, much bigger Spain warns it can't keep afloat without help, as stock markets around the world tank over fears the leaders won't have the political will to act.
The summit will have to fight multiple fires: political uncertainty in Greece that could have it renege on commitments made to secure rescue loans; rising borrowing costs in Spain and Italy that could force them to seek bailouts; and sluggish growth across the region exacerbated by budget cuts meant to reassure markets about high debt levels.
"What we need is a decisive plan for Greece, and we need decisive plans to help get the European economies moving," British Prime Minister David Cameron said as he headed into the summit of leaders of the 27 countries that make up the EU, which includes the 17-member eurozone.
"But if we're not going to keep coming back and back to meetings like this, we also need to deal with some of the longer-term issues at the heart of running successful single currency, having a bank that gets behind that single currency, having coherent long-term plans to make sure that single currency is coherent," he said.
Leaders have said that everything will be on the table, including a discussion about whether the countries that use the euro should spread the risk and borrow money jointly -- issuing so-called "eurobonds." This would mean every country could borrow funds at the same rate, substantially lowering the costs for the more indebted countries.
But expectations were low for agreement on concrete measures to boost growth and stability in the eurozone. Europe's main stock indexes plunged more than 2 percent. The euro fell 0.8 percent to $1.2561, its lowest in nearly two years.