Berlin  - European Commission President Jose Manuel Barroso on Wednesday spoke of concerns that Europe's markets could face further destabilzation.

He made his comments during a meeting with German Chancellor Angela Merkel.

"We are worried about a further destabilization of the financial markets and economies," Barroso said. He added that further measures were being considered, such as regulations for hedge funds, investment funds and management compensation packages.

The Commission chief was in Berlin for talks ahead of a European finance summit Sunday.

Barroso stressed the pole position of Europe's largest economy, saying, "Germany plays a key role for the resolution of this crisis."

Sunday's talks in Berlin are due to be attended by France, Britain, Italy, Spain and the Netherlands, who, together with Germany, form the European contingent of the G20 group of the world's major economic powers.

The group's aim is develop a common European approach to the financial crisis, ahead of a G20 summit scheduled in London on April 2. (dpa)