Putin's leading role at EU summit

By Robin Oakley, CNN's European Political Editor

STOCKHOLM, Sweden (CNN) -- European Union leaders seeking to put the focus on economic reform at their latest summit have been upstaged by their visitor, Russian President Vladimir Putin.

The meeting has also been diverted by concerns over the spread of foot and mouth disease.

Putin, invited as a poor relation to discuss what reforms he plans to ensure that the economic gap between Russia and the EU did not widen further, instead accentuated the positive.

He called for co-operation, saying Russia could help to ensure continuity of energy supplies for Europe if western Europe nations provided the funding to develop energy production in his country.

AUDIO Robin Oakley: A single financial market on the horizon 572kb/53sec. AIFF or WAV sound No new funds for foot and mouth crisis 444kb/41sec. AIFF or WAV sound

He also declared that use of Russia as a conduit to the east could cut costs for EU businesses and boost growth and jobs in the EU.

EU leaders have pressured Putin to find a political solution in breakaway Chechnya .

But while he acknowledged a humanitarian problem and said he shared their concerns, Putin defended his blitzing of Chechnya by saying that terrorist bases had to be destroyed.

Knowing that the leaders were about to meet Macedonian President Boris Trajkovski to discuss his problems with ethnic Albanian rebels in Macedonia, Putin dramatically compared Russia’s experience in Chechnya with the latest troubles in Macedonia.

He insisted: "Nothing has been done to disarm the terrorists -- and I would like to call those who are attacking Macedonia terrorists, not rebels. Things should be called by their own names."

Chris Patten, the EU Commissioner for External Relations later told CNN : “I don’t think it’s one of the more exact comparisons I have heard.”

The EU leaders opened their proceedings earlier by discussing the foot and mouth outbreak now affecting four of the 15 countries.

Britain’s Prime Minister Tony Blair briefed them on a new UK government report presenting what British spokesmen called a "very, very serious picture" and suggesting that outbreaks in Britain would grow fast in the next few weeks, necessitating "further drastic action."

But the EU leaders did not discuss the economic consequences of the foot and mouth outbreak.

They had been told by Romano Prodi, the President of the European Commission, that the EU agriculture budget for the year is already exhausted. Farm ministers will tackle that problem later.

Fast-track system

The EU leaders pledged a year ago in Lisbon to turn the grouping into the most dynamic force in the world economy.

The had hoped that agreement late on Thursday night by finance ministers on a new "fast-track" system of regulating financial services would prove a crucial breakthrough, easing the supply of capital for innovation and job creation.

But the European Parliament, reluctant to lose its scrutiny powers over the present tangled system of regulation, has to agree implementation of the new system.

On Friday its President Nicole Fontaine halted the earlier jubilation by demanding talks with the European Commission and Council of national leaders "to reach an agreement which is acceptable to all three institutions."

EU leaders have been urged by Prodi to show they have the political will to deliver economic reforms which would open up competition and bring cheaper pensions and insurance for many millions as well as cheaper gas and electricity prices across Europe.

They are continuing discussions trying to ensure the opening up of markets across national borders in gas, electricity and postal services, full competition on air fares in a “single European sky” and creation of a Europe-wide patent for inventions.

Summit faces derailment
March 21, 2001

Europa: Stockholm Summit
EU: Swedish Presidency

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