BRUSSELS, March 13 (Xinhua) -- The European Union summit kicks off Thursday with the aim of finding a way out of the persistent turbulence caused by the U.S. sub-prime mortgage market crisis. It is now a major downside risk to the economy in the 27-nation bloc.

    It has become tradition for the EU spring summit to focus on the economic dimension of the 27-nation bloc. With financial stability, economic reforms and climate change high on the agenda, this year the summit opens at a time when difficulties in the international financial sector are still working their way through the system.

    Since last summer when the U.S. sub-prime mortgage crisis broke out, European financial markets have come under tremendous pressure in the credit squeeze, with financial institutions reluctant to lend for fear of being sucked into the turmoil.

    Nobody knows how big the losses will be. The continuous uncertainty has undermined trust and confidence among investors and consumers, clouding the economic outlook of the EU.

    In a bid to restore financial stability, EU leaders were expected to endorse a series of measures in the financial sector, such as encouraging prompt and full disclosure of losses by financial institutions and enhancing their transparency. The leaders are also likely to back measures to improve information provided by credit ratings agencies and early warning systems on financial stability, and step up cooperation between regulatory authorities in the EU and globally.

    EU leaders were also scheduled to adopt the next three-year cycle of the Lisbon strategy, a flagship reform project within the27-nation bloc aimed at promoting economic growth and jobs when it was relaunched in 2005.

    They hope reforms on a macro-economic level will put the EU in a better position to cope with the current shocks sending tremors through the economy.

    "With the Lisbon strategy for growth and jobs, the EU has the right policies and instruments to help it weather the current storms and continue to deliver growth and jobs," the European Commission said in a document prepared for the summit.

    Besides the financial issues, the EU leaders are also expected to discuss topics such as climate change.

    One year after EU leaders agreed on an ambitious greenhouse gas emissions package at their last spring summit, they will turn to details this time.

    The EU leaders pledged last March that greenhouse gas emission should be reduced by 20 percent by 2020 from the level of 1990, and renewable energy should account for 20 percent of total energy use while biofuels take up 10 percent in fuel consumption.

    However, it proved no easy task to attain the ambitious goals. The European Commission presented a detailed plan in January setting out binding targets for each member state, and it was not well received in all of the EU capitals.

    A draft conclusion prepared by the EU's Slovenian presidency ahead of the summit even calls for the 27 EU member states to go beyond a 20 percent cut and target a more ambitious 30 percent cut.

    Despite easy consensus on the overall targets, differences are certain to remain on how to meet them. Analysts are saying they expect no hard decisions at the summit.

    During their two-day meeting, the EU leaders will also focus on the role of sovereign wealth funds.

    Recent years have seen some eye-catching investments by sovereign wealth funds, arousing concern among some EU member states.

    In line with the European Commission's proposal, the EU leaders were expected to call for a voluntary code of conduct on the funds.

    Though economic issues will dominate their talks, EU leaders will also use the opportunity to touch on a series of international hot topics, such as Kosovo, the Western Balkans, Iran and the Middle East peace process.