Meanwhile, a more powerful EU is looking for more say in the global financial system, which has been dominated by the United States. The financial crisis actually provides a rare chance for the EU to challenge Washington.

So, it was on the EU's initiative that the G20 leaders met for the first time to discuss the financial crisis in Washington last November, with an aim to build a new "Bretton Woods system" as dubbed by EU leaders.

If the Washington summit only marks the beginning of a long-term process of reforming the international financial system, the London summit would be a perfect stage for the EU to fight for real progress since Europe has the advantage of hosting the event.

On a joint front, the EU countries are calling on the G20 leaders to reach an agreement to ensure appropriate regulations and oversight of all financial markets, products and participants that may present a systemic risk.

Corporate remuneration practices, capital requirements and accounting standards of the banks, which contributed to the current crisis, all need to be improved.

The EU also wants to improve surveillance instruments of the International Monetary Fund in order to strengthen its key role in crisis prevention and in supporting the reform of the governance of international financial institutions by giving more say to the emerging economies.

No miracle in London

In a bid to set an example for the world, the EU is putting in place tougher regulations on credit rating agencies, capital requirements and deposit guarantees.

The European Commission, the EU's executive arm, also will soon take action on hedge funds, private equity and remuneration.

Although the EU holds high expectations for the London summit and Sarkozy even warned that he may walk out of the meeting if France's demand for tougher financial rules is not satisfied, it remains unclear what can be really achieved.

European Commission President Jose Manuel Barroso said that the summit should make specific commitments on capital requirements, hedge funds, credit ratings agencies, accounting standards, remuneration and tax havens.

But he warned the summit would yield no "miracle solution" for the financial crisis and more talks may be necessary later this year.

"The G20 will not end this crisis overnight. But it can, it must, it will, make a difference," Barroso said.

Merkel also said more summits are definitely needed.

"We are talking about building a new global financial market architecture and we will not be able to finish this in London," she said ahead of the summit.

(Xinhua News Agency April 2, 2009)