PM holds talks with his big ally in Europe – and Merkel with hers

Cameron's isolation obvious as leaders gather to sign fiscal compact

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Indy Politics

David Cameron last night urged other European Union leaders to match their rhetoric about boosting growth with firm action to ensure the 27-nation bloc emerges from its economic crisis.

The Prime Minister won the backing of 11 other EU countries for a "plan for growth" but told a two-day summit of European leaders in Brussels that it had not been fully reflected in the draft statement to be formally agreed today.

At last night's opening session, he called for more specific action, with firm timetables and progress-chasing at future summits to make sure EU leaders' decisions are properly followed through. British sources said he believed there was no point in having "talking shop" meetings which did not measure how the proposals they agreed were implemented. Four of five other nations also expressed sympathy in the ideas in the British-backed plan as Mr Cameron tried to show that he is not an isolated figure in the 27-nation club.

However, the Prime Minister will cut a lonely figure today, when 25 other EU leaders sign up to a fiscal compact to rein in their borrowing to prevent another Greek-style debt crisis. Mr Cameron will be absent from the signing ceremony, holding talks with UK officials in another part of the building where an EU summit is taking place.

He angered many of his fellow leaders in December by vetoing an EU-wide fiscal pact. But his decision will not stop the 25 will going ahead today with an agreement outside the Union's governing treaties. The only other EU member not endorsing the deal is the Czech Republic.

In another attempt to deny he is out on a limb, Mr Cameron held Downing Street talks yesterday with Petr Necas, his Czech counterpart, and travelled with him to Brussels on Eurostar for the EU summit.

Mr Cameron's officials trumpeted the decision of the 11 other EU nations, including Italy and Spain, representing half of Europe's 500m population, to back a pre-summit letter with Britain calling for a new push for growth, rather than a rival statement tabled by Germany and France. Although EU sources played down the differences, they said the British-backed plan put more emphasis on free trade and deepening the EU single market than the Franco-German blueprint. For the past year, meetings of EU leaders have been overshadowed by the crisis in Greece and been seen as an exercise in crisis management. As they gathered for a working dinner last night, the atmosphere was calmer than usual as their minds turned to creating the growth needed to answer critics who say the fiscal compact will entrench "collective austerity".

Arriving in Brussels, Mr Cameron said: "Europe doesn't just face a debt crisis, Europe also faces a growth crisis. Britain, together with 11 other European countries, has come together and set out a whole series of measures that the EU can take that would help drive growth, including deregulating businesses to set them free to create more jobs. That's the agenda I am going to be driving."

Although the meeting took place against a relative calm on the financial markets, new figures showed that the unemployment rate in the eurozone has risen to 10.7 per cent, the highest since the euro was created in 1999.

"This crisis and some remedies put social cohesion at stake. It can also damage the European idea itself," said Herman Van Rompuy, the EU President, who will be formally re-elected at the summit for a second two-and-a-half-year term.

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