(Reuters)
European leaders are due to plan their next moves to bring economies back from a precipice in a two-day summit from Thursday.
The European Union summit in Brussels on Dec. 11 and 12 will study European Commission proposals to give the sagging world economy a sharp boost with a 200 billion euro ($257 billion) spending plan.
* EUROPEAN UNION:
— The European Commission approved on Nov. 26 proposals for an EU-wide fiscal stimulus package worth 200 billion euros.
— The proposal amounted to 1.5 percent of the bloc's gross domestic product (GDP) and is to be made up of 1.2 percentage points of budget spending and 0.3 percentage point of EU funding. The plan includes 5 billion euros of extra funding for the European car sector. It also includes a temporary, across-the-board value-added tax (VAT) cut.
Here are some details of how European member states will spend that money:
* FRANCE:
— France has unveiled a 26 billion euro stimulus package — equivalent to 1.3 percent of gross domestic product.
— The French economy minister said the plan should create 80,000-110,000 new jobs, making up for the expected disappearance of some 90,000 jobs next year due to the crisis.
— The stimulus plan earmarks 10.5 billion euros for infrastructure, research and support for local authorities. This includes 4 billion euros for investment for state-owned rail, energy and postal companies, including a pledge to speed up projects such as a fast train link in western France.
* GERMANY:
— Germany's lower house of parliament passed a package of measures worth 31 billion euros last week, which will generate 50 billion euros of investment and new contracts over two years.
— A new lending programme of up to 15 billion euros will be introduced for German state-owned development bank Kreditanstalt fuer Wiederaufbau (KfW) to strengthen its lending activities. KfW's infrastructure programme for structurally weak local authorities will be raised by 3 billion euros.
— Urgent investment in transport will be accelerated via a new programme totalling 1 billion euros in both 2009 and 2010.
— Parliament approved a rise in government net new borrowing in 2009 to 18.5 billion euros from 10.5 billion.
* HUNGARY:
— Hungary has announced plans for a 1.4 trillion forint ($6.9 billion), two-year stimulus package to kick-start economic growth. The package does not involve new spending but a regrouping of existing funds to assist businesses.
— 680 billion forints will be allocated to provide lending guarantees primarily to SMEs and 260 billion forints will provide liquidity for lending.
* ITALY:
— Italy late last month approved a stimulus package to help families and firms hit by the global financial crisis. Prime Minister Silvio Berlusconi said the measures amounted to 80 billion euros, but economists pointed out the vast majority was a recycling of existing funds.
— The measures included a temporary freeze on regulated energy prices and road tolls, 2.4 billion euros in tax breaks for poorer families and some marginal easing of the direct and indirect tax burden for companies.
* NETHERLANDS:
— The government has announced a "liquidity impulse" of about 6 billion euros, including allowing companies to write down investments earlier than usual.
— Companies will also receive temporary financial support from an unemployment fund to pay employees who will cut their working hours.
* SPAIN:
— In the last six months, Spain has announced various measures to cushion the impact of the economic slowdown and soaring unemployment including a 38 billion euro fiscal stimulus package.
— The package includes 6 billion euros in tax cuts and 4 billion euros of liquidity to credit-strapped companies and households.
— The government said last week it will spend an extra 11 billion euros on public works and other stimulus measures to create 300,000 jobs next year. The plan, equivalent to roughly 1 percent of Spanish GDP, includes 800 million euros in aid for the auto sector.
* SWEDEN:
— Swedish Finance Minister Anders Borg said last week the government was planning stimulus measures of less than 15 billion Swedish crowns ($1.8 billion) to help cushion the blow of a withering financial crisis.
SWITZERLAND:
— The government announced an economic stimulus package worth 890 million Swiss francs ($732 million). It includes government spending of 340 million francs on flood defence, natural disasters and energy-efficiency projects.
— Spending plans also include up to 1 billion francs on roads and railways and 550 million francs as tax breaks to 650 firms for job creation programmes.
* UNITED KINGDOM:
— Britain announced on Nov. 24 that it would pump 20 billion pounds ($29.7 billion) into the economy which includes tax cuts and 3 billion pounds of capital spending.
— The plan includes a value-added tax or VAT reduction to 15 percent from 17.5 percent, effective from Dec. 1 until the end of 2009.
— The plan also extended a system of tax repayments to help businesses which were previously profitable but now making losses. Losses of up to 50,000 pounds could be offset against profits made in the past three years — benefitting 75,000 businesses. It also included an exemption for companies' foreign dividends from tax in 2009.
