Ireland crisis could cause EU collapse, warns president

Herman Van Rompuy, president of the EU, has warned it faces a 'survival crisis', with the risk of contagion spreading from Ireland across the continent.

The president of the European Union has warned that the EU could collapse unless the debt crisis that is gripping the region is resolved.

Herman Van Rompuy, president of the European Council, raised the stakes ahead of this evening's showdown talks between finance ministers in Brussels. With Ireland and Portugal both on the brink of seeking a bailout, Van Rompuy warned that there is a serious risk of contagion spreading across the continent.

"We're in a survival crisis," Van Rompuy said in a speech in Brussels. "We all have to work together in order to survive with the eurozone, because if we don't survive with the eurozone we will not survive with the European Union."

However, the former Belgian prime minister added: "I'm very confident we will overcome this."

Van Rompuy's speech added to the pressure on the Irish government, which was continuing to resist international pressure to accept a bailout this morning.

http://www.guardian.co.uk/business/2010/nov/16/ireland-bailout-government-says-no-need-to-panic

Ireland Hopes Boost European Stocks

LONDON—European stocks rose Thursday as the Irish government seemed more likely to accept some sort of bailout from its European partners, resulting in greater confidence among investors.

The Stoxx Europe 600 Index rose 0.7% to 269.19. London's FTSE 100 increased 0.8% at 5735.72, Frankfurt's DAX rose 1.0% to 6769.49 and Paris's CAC-40 gained 1.1% to 3832.40.

Rabobank noted a tentative improvement in appetite for less-defensive asset classes, as European Union and International Monetary Fund teams started to assess Ireland's banking-sector liabilities.

It said the size of the liabilities of the Irish banks is "not to be sniffed at". Market analysts have been speculating that the banks could need financial support in the order of €80 billion ($108.12 billion), far greater than Ireland's €24.7 billion tax take in the first 10 months of this year, although this is small in global terms.

http://online.wsj.com/article/SB10001424052748704104104575621851854404986.html?mod=WSJ_Markets_LeadStoryEurope