Stimulus package in motion for E.U.
The European Commission is drawing up plans for a stimulus plan for all of Europe. The package would total about $160 billion, the same amount as the first package for the U.S. Stephen Beard reports.
Belgian Prime Minister Yves Leterme (left, not pictured) and European Commission chairman Jose Manuel Barroso (right, pictured) talk to the press in Brussels after a meeting on the financial crisis -- November 20, 2008 (Dominique Faget/AFP/Getty Images)
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Scott Jagow: Some love for Iceland today from its "neighbors." Finland, Sweden, Norway and Denmark said they would lend Iceland $2.5 billion to help it recover from economic meltdown. The IMF will pitch in another $2 billion. And members of the E.U. are drawing up plans for a stimulus package for all of Europe. From London, Stephen Beard reports.
Stephen Beard: The European Commission presents its plan next week. The signs are that it will call on the E.U.'s 27 member states to unleash a concerted fiscal blitz.
The Commission wants them to spend at least 1 percent of their GDP, either on tax cuts or extra public expenditure. That's a total of around $160 billion -- the same size as America's first stimulus package earlier this year.
Europe's action is belated but necessary, says Phillip White of the Center for European Reform:
Phillip White: Europe has been conning itself for much of the past year that it would be insulated from this economic storm. But I think now it has actually woken up to the fact that it is heading for a very nasty recession.
He believes the E.U. economy as a whole will shrink by up to 2 percent next year. Some member states could fare even worse. Ireland is forecast to contract by a hefty 4 percent.
In London, this is Stephen Beard for Marketplace.
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