EU moves towards agreement on growth package

By Gernot Heller

BERLIN (Reuters) - European Union member states moved closer to agreeing measures to boost the bloc's economy on Thursday despite doubts raised about a 130 billion euro (110 billion pound) growth package planned by the European Commission.

Germany has said the Commission, the EU's executive, plans to request that member states contribute about 1 percent of the bloc's gross domestic product to the package to help the 27-nation EU fight recession sparked by the financial crisis.

German Chancellor Angela Merkel said in Frankfurt she was "very optimistic" member states would agree on joint action so as to bolster the European job market.

The steps measures could be implemented nationally, she said, adding that it might make sense to have the European Investment Bank provide loans to fund the plans.

The growth package, which is due to be unveiled next Wednesday, won the backing of Spain, whose Prime Minister Jose Luis Rodriguez Zapatero said his country was ready to commit 1 percent of GDP to a fiscal stimulus programme.

"We are going to unite efforts, combine plans and, I hope, give a strong and combined response," Zapatero said.

The German Finance Ministry said it welcomed the planned measures, but that it saw the package as a coordinated summary of national stimulus programmes, rather than a wide-reaching supplement to which member states had to contribute new funds.

"It can't be an on-top programme," a spokesman for the ministry said, but added he did not rule out that the package could include some new Europe-wide elements.