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Davos leaders: Save the euro, and the planet

Associated Press Modified: January 27, 2011 at 4:16 pm •  Published: January 27, 2011
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DAVOS, Switzerland (AP) — France's president tried Thursday to save the reputation of Europe and its currency, battered by debt crises and worries about whether the continent is being steamrolled by speedier eastern economies.

The presidents of South Africa and Mexico, meanwhile, worked to save the planet, sharing notes on hosting climate talks and how to get the U.S. and China — and the business community — to invest in cleaner energy.

The overall mood at the World Economic Forum this year is more upbeat than the past two, but by no means celebratory. Thursday was no exception, as leaders, bankers and investors struggled for ideas to get Europe growing again.

As they spoke, a small explosion in a Davos hotel briefly disrupted the Alpine winter calm, unusual for this Swiss resort, blanketed in security during the annual forum. Windows were broken but there were no injuries, Swiss police said.

French President Nicolas Sarkozy sought to shake the euro worriers awake, vowing that he and European partners will "never turn our backs on the euro" and calling it a linchpin of peace and prosperity. That gave an extra boost to the rebounding currency on world markets.

"The disappearance of the euro would be so cataclysmic that we can't even possibly entertain the idea," Sarkozy said.

Despite fears about the 17-nation currency's survival since the European Union and International Monetary Fund had to bail out debt-laden Greece and then Ireland last year, "the euro is still there," he said.

"Europe has had 60 years of peace and therefore we will never let the euro go or be destroyed. ... I speak as much for my German friends as I do for the French," he said.

European Central Bank chief Jean-Claude Trichet, apparently trying to smooth concerns about above-target inflation, praised the euro's long-term prospects at another Davos session.

"The euro delivered what had been asked from it, namely price stability," he said.

Increasingly, the talk among European leaders is of closer economic union — instead of just monetary union. Trichet said he is pushing for bolder moves from EU leaders. "There is no time for complacency," he said.

The 2,500 participants at Davos can see the currency shock in their pockets, as hotels, restaurants and bars in the Swiss ski resort of Davos do business in francs, whose value has surged against the euro in recent months.

Swedish investor Jacob Wallenberg warned that Europe needs to act faster to stay competitive.

"We all see countries such as China, India, rapidly becoming much more competitive," he said. "It's not a matter of they're going to bypass us. They're going to run us over."

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