At the end of the weekend meeting, leaders said they had a duty to avert global recession and sent a strong hint to Europe's central bankers that interest rates should be cut to boost demand for jobs and growth.

The summit brought together the new centre-left leaders of Italy and Germany with their EU counterparts, for the first time.

Making his EU debut, incoming German Chancellor Gerhard Schröder urged European Union leaders to make the battle against unemployment their number one priority.

While Massimo d'Alema, Italy's new ex-communist prime minister and another newcomer to EU summits, called for a European programme to boost industrial investment.

Jobs strategy

Making a clear break with his conservative predecessor Helmut Kohl, Mr Schröder called for leaders to pass an EU jobs pact by the end of the year.

EU unemployment currently stands at 18 million .

Mr Schröder said: "Reducing unemployment is the most important single question for the people of Europe."

Helmut Kohl always resisted any move towards an EU-wide jobs strategy, arguing that it was a job for EU governments not Brussels.

Demands for growth

Mr Schröder also called for leaders to enter into a dialogue with Europe's central bankers to persuade them to reduce interest rates.

Of the 15 EU leaders, 13 believe that concerted state intervention is the key to boosting growth and cutting unemployment.

EU leaders also agreed that growth in the continent should be sustained during the ongoing global economic crisis.

Last week, the European Commission issued its revised economic forecasts which slashed next year's growth estimates from 3.2 to 2.6%.

Lionel Jospin, France's Socialist Prime Minister, said: "Europe should be able to represent an area of growth for the next 10 to 15 years.

"The Union should mark its political determination to support growth," he added.

Last week, a distinctly new, centre-left Franco-German axis emerged when Oskar Lafontaine, the new German Finance Minister, and his French counterpart Dominque Strauss-Kahn, jointly called for a "policy of growth in Europe to fight against unemployment."

They stressed this should include exchange rate policies that set loose targets for the values of the euro, the dollar and the yen - at odds with the free market orthodoxies of the new European Central Bank led by Dutchman Wim Duisenberg.

Italian intervention

Italy's Prime Minister Massimo d'Alema made his mark at the summit by calling for a new European Programme to boost industrial investment.

He proposed a relaxation of the strict "stability pact" rules for countries which adopt the single currency.

The pact require euro-zone countries to aim for balanced budgets and can face stiff fines if they allow deficits to rise above a ceiling of 3% of GDP.