BRUSSELS (AFP) - Europe vowed to do "whatever is necessary" on Sunday to defend debt-addled euro nations as Asian markets readied to reopen, after US President Barack Obama demanded "resolute" action.

• Swedish taxpayers 'not willing' to bailout Greece
• 'Greece is like Lehman Brothers'

EU ministers staging emergency talks in Brussels are tasked by euro leaders with heading off predatory threats to government finances, commercial banks and wider economic recovery after shares tumbled across the globe last week.

Their discussions were marked by drama, when German finance minister Wolfgang Schaeuble was taken to hospital for treatment -- and by dispute, when a British government on its last legs set conditions for its backing.

Obama held morning telephone talks with German Chancellor Angela Merkel for the second time in three days on Sunday "as part of his ongoing engagement with regard to the economic situation there."

Spanish finance minister Elena Salgado, chairing the EU crisis talks, insisted that the bloc will stop at nothing to shore up the eurozone, as a series of proposals were placed before her peers.

"We are going to defend the euro," she said. "We will do whatever is necessary to reach this objective."

"We need to make progress today, we cannot afford dispointment with the markets," underlined Anders Borg of non-euro Sweden.

However, in what could be its last act in power, non-euro Britain opposed a bid to see all 27 EU nations conscripted into guaranteeing massive borrowings on bond markets in the EU's name, at a time when weaker euro economies are under intense pressure.

British Finance Minister Alistair Darling indicated that he would insist that these new guarantees must come only from euro nations.

"What we will not do and what we can't do is provide support for the euro," Darling told Sky News TV after landing.

The bloc wants to assemble a kind of "bank" that can then be used to leverage vast borrowings to bail out troubled economies -- as governments did with their banks during the global financial crisis -- while keeping interest rates down.

A European source said the commission can already raise 60 billion euros (more than 75 billion dollars) on the back of the EU's budget, but that in order to raise greater funds, "it needs member states' guarantees."

The source added: "The question under discussion is whether that happens on a voluntary or an obligatory basis, and whether it involves the 16 euro countries or the 27 EU members."

An existing 50-billion-euro facility available only to non-euro members, and which has been used in the past to help Romania, Hungary, Latvia, is set to be extended by another 60 billion euros, with all 27 buying in to this in exchange for opening it up to eurozone members.

Britain has "no problem" with that element, a British diplomat said, "as long as the IMF has the same kind of involvement," which would mean accepting IMF conditions including cuts to public finances in exchange for top-up funds, along the lines of the Greek model.

But given huge debts of its own and Brussels predictions it will post the EU's highest deficit for 2010, London refuses to put taxpayer funds up to dig countries such as Portugal, Spain and Italy out of the mire.

Britain is also in the thick of power-sharing talks which could result in a new Conservative government within days if not hours.

A third element, various diplomats said, was to obtain what one called a "gesture" from the European Central Bank, what traders and analysts refer to as a "nuclear" option, which means Frankfurt agreeing to buy euro countries' bonds, or debt.

Diplomats said the overall direction translates into a mini-European version of the International Monetary Fund.

Typically coy, ECB chief Jean-Claude Trichet has not ruled out moves that could trigger a debt-buying spree, although he laid "responsibility" for the new backstop arrangements at the door of the EU's political masters.

The ECB is involved in parallel meetings between world peers in non-EU Switzerland.

European ministers could, in theory, use qualified majority voting to outgun London.

One way or another, "between now and Sunday night we will have a watertight line of defence," euro finance chief Jean-Claude Juncker insisted on Friday.

"This is a important moment" for Europe, stressed France's finance minister Christine Lagarde, with Austria's Josef Proll labelling it "the biggest challenge since the euro's creation."