"I could feel a sense of urgency and a spirit of cooperation around the table," Herman Van Rompuy, the president of the European Council, said after a meeting of EU finance ministers in Brussels Friday. "Everyone shares the will to go forward."

Van Van Rompuy said all 27 member states agreed on four main objectives: To push for greater budgetary discipline; to find ways to reduce the divergences in competitiveness between member states; to come up with an effective crisis management mechanism; and to strengthen economic governance to be able to act quicker and in a more coordinated and efficient manner to future crises.

The objectives are to be included in a formal agreement drafted in the coming weeks.

The meeting comes after parliamentarians in Germany, Europe's largest economy, on Friday green-lighted a measure that allows the country to contribute massively to an unprecedented $1 trillion loan package for economically troubled eurozone members.

Germany is to guarantee loans of up to $184 billion after the Bundestag voted 319 to 73 in favor of the package, which had sparked controversial debates in Germany. The major opposition lawmakers all abstained, with a far-left party voting against it. The government had lobbied for the measure, saying it was in Germany's best interest to defend the euro, the common currency for 16 EU member states.

The overall aid package was drafted by leaders from the EU and the International Monetary Fund earlier this month. It is aimed at injecting stability into a market that has has been troubled by a near-default of Greece, a weakening euro and steeply declining stock markets.

Officials in Europe fear that the Greek crisis could infect similarly indebted countries like Portugal, Spain, Ireland and maybe even Italy.

The southern European economies not only suffer from high deficits but also from an inherent structural economic weakness compared to northern countries.

Greece has been forced to adopt stringent austerity measures that include rising taxes, cutting pensions and freezing salaries in order to unlock money from a personalized $150 billion rescue fund. The austerity measures sparked social unrest in Greece.

earlier related report
Clinton, Geithner arrive in Beijing for talks with China
Beijing (AFP) May 23, 2010 - US Secretary of State Hillary Clinton arrived in Beijing Sunday ahead of talks with Chinese leaders on trade issues and security threats including renewed tensions on the Korean peninsula.

Clinton flew into the capital from Shanghai, where she had toured the World Expo site, and attended a state dinner hosted by Dai Bingguo, a member of China's State Council, or cabinet.

Clinton and Treasury Secretary Timothy Geithner, who arrived earlier Sunday, open two days of talks Monday with Dai and Vice Premier Wang Qishan under the annual Strategic and Economic Dialogue, the highest-level bilateral forum.

Korean tensions have leapt to the top of the agenda after a multinational panel said on Thursday that evidence indicated a North Korean submarine torpedoed the South Korean navy corvette Cheonan in March, killing 46 sailors.

Clinton was expected to seek Beijing's cooperation in backing a response against North Korea, which is heavily dependent on trade and diplomatic support from its neighbour and closest ally, China.

Clinton briefed Dai on the inquiry into the sinking of the warship, a senior US official said Sunday.

"We've shared with them some specific information" during a dinner ahead of the dialogue, the official said on condition of anonymity.

Clinton also told Dai the substance of a statement due to be made Monday evening by South Korean leader Lee Myung-Bak, and said Washington would back all measures announced.

The US and other world powers have strongly condemned Pyongyang for its "provocative behaviour" in the sinking of the Cheonan but China -- North Korea's sole major ally -- called for restraint and said it would make its own assessment of the investigators' report.

"The Chinese are still digesting the implications" of the inquiry, said the official, adding that Washington expected Beijing "to take some steps in the international arena to underscore the seriousness of the matter."

Pyongyang quickly rejected the investigators' findings and launched threats of war if it is punished by the international community.

South Korean President Lee Myung-Bak will outline his country's response on Monday, including a plan to ask the Security Council to impose sanctions, a spokesman said in Seoul.

Relations between Washington and Beijing have improved recently after a rocky patch earlier in the year over US arms sales to Taiwan, Obama's White House meeting with the Dalai Lama, Internet freedom and trade disputes.

But the two sides were expected to take up contentious trade and investment issues ranging from US calls for reform of the yuan currency to recent tit-for-tat punitive trade actions.

Some in the US Congress accuse Beijing of keeping its currency artificially low to boost its exports.

Chinese industrial policies restricting US and other foreign businesses as well as perennial charges of copyright piracy in the world's most populous nation are also on the agenda.

During a visit to a Boeing aircraft maintenance site in Shanghai, Clinton on Sunday called for a level playing field for trade in China.

"For trade to work in any economy and for it to produce the benefits we know it can, there must be a level playing field where domestic and international companies can compete freely and openly," she said.

In April, an annual report by US Trade Representative Ron Kirk said China had erected new hurdles to foreign competition with rules favouring domestic firms.

"One of our priorities is to encourage a more balanced economic relationship between the United States and China," Clinton said.

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