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Chancellor Merkel, who will chair the EU summit this Thursday and Friday in Brussels, told the UK's Financial Times an agreement on reducing carbon emissions would be the first of several potentially painful steps for the 27 EU members.

It is hoped EU leaders will agree to a deeper cut of 30% in emissions by 2020 if other developed and emerging nations, notably India and China, join in.

"The necessity to combat climate change and to reduce our energy dependency, coupled with the fact Kyoto is running out, have concentrated minds," Merkel said. The Kyoto Protocol on greenhouse gas emissions is due to expire in 2012.