BRUSSELS / LONDON - European Union leaders agreed a five-element framework of
a comprehensive strategy to root out fiscal and economic woes, the details of
which will be announced after an evening summit on Wednesday.

The framework, agreed on Sunday after EU and eurozone leaders' summits, will
promote growth and jobs with promises of substantial fiscal injections, though
the majority of the 27 countries are deeply indebted.

Observers said European leaders' emphasis on jobs and growth can help pave
the way for countries such as China to play a role in helping Europe stave off
an economic crisis.

The leaders also agreed to mobilize new resources for Greece to make its
fiscal funds sustainable, and build up a sufficient firewall against possible
debt crisis contagion in Italy, Portugal and Spain. They also promised to design
a coordinated scheme to recapitalize banks and improve their funding, and to
take measures to ensure better governance and stronger integration of the euro
area.

European Council President Herman Van Rompuy said: "These five elements are
all interrelated. Both technically and politically they are part of one single
package.

"Further work is still needed. That's why we will take the decisions at the
follow-up euro summit," he added.

Admitting that fiscal margins are currently limited for most member states,
Van Rompuy said the EU wants to combine measures that bring deficits under
control with policies that cushion growth.

He said Europe's trade and investment relations with its international
partners are another element of growth, and he said the leaders discussed how to
use these relations more strategically.

"In this context, we also prepared the union's message to the G20 Summit at
the beginning of November in Cannes, France," Van Rompuy said.

Professor Yao Shujie from the University of Nottingham in the United Kingdom
said the major problems of the European economy that made its debt situation a
major crisis are the extremely high levels of debt and the external nature of
the debt, adding that many of Europe's debts are borrowed externally and
foreigners will not tolerate the idea of not getting their money back.

Yao said it is a good idea for China to buy eurobonds. "If China invests in
the bonds of a single country there is no guarantee of return," Yao said.

For example, if China buys Greek bonds and Greece defaults, all the money is
lost. To dilute the risk, China can invest in European countries collectively
through eurobonds.

Yao said China's role in the eurozone crisis is to bring confidence more than
money. "Whatever China invests will be little compared to what is needed to
rescue the eurozone countries.

"But if China helps Europe, then it shows the world that it believes Europe
will recover," said Yao.

Christos Vlachos, director for the Greece-China Business Council, said the
EU's message is very positive and that Chinese investors are welcome in Greece.

"They can take up low-risk projects, such as infrastructure, which are badly
needed, and Chinese construction companies are especially welcome," Vlachos said
in telephone interview.

Vlachos said many motorway projects in Greece have stopped because of a lack
of financing.

"Chinese investors could step in, and Chinese investors can have a
controlling role if they want to," said Vlachos.

However, the Chinese side has encountered some difficulties in investing in
Europe.

"There have been two opposing forces in Europe's contact with China,"
Vice-Foreign Minister Fu Ying recently told journalists in Brussels.

First, some Europeans acknowledge China's economic and social progress,
hoping that China would help Europe, but at the same time they point fingers
very readily at China's political system and occasionally tend to politicize
economic matters.

Second, some pin high expectations on greater trade and investment
cooperation with China, but at the same time they show worries over Chinese
investment, thus hurting the atmosphere of cooperation.

"Europe should get over the psychological hurdle, adapt to the new reality,
retire stereotypes and accept a diversified world," Fu said on the website of
China's mission to the EU.

"European countries should be more welcoming to investment from developing
countries and actively help them, including investors from China, from which
both sides stand to benefit."

Eveline Filon contributed to this story.