The leaders of France, Germany, Italy, and Spain agreed to push for a growth package worth up to $163 billion at a European Union summit next week aimed at kickstarting the economy and safeguarding the currency bloc. French President Francois Hollande, German Chancellor Angela Merkel, Spanish Prime Minister Mariano Rajoy, and Italian Premier Mario Monti provided few concrete details beyond agreement on pursuing a financial transaction tax—something that Germany has championed.
Perhaps the biggest breakthrough of the brief summit was Merkel's acknowledgement that austerity alone won't cure the euro's woes. Merkel has come under increasing pressure to give ground on pro-growth measures. "We say that growth and solid financials are two sides of a coin," she said. "Solid financials are not sufficient." Monti, who met with his fellow leaders at a government villa in Rome, is trying to build a bridge between Merkel's insistence on fiscal discipline and the focus on growth by recently elected Hollande. He has warned of severe consequences for the 17 countries that use the euro and the world economy if next week's summit fails.