Brussels- The European Union's 27 finance ministers were meeting in Brussels on Tuesday amid gloomy new forecasts predicting a 4-per cent contraction of the bloc's economy this year.

The meeting follows talks late Monday among the 16 countries that share the euro, in which ministers expressed concern about rising unemployment while ruling out the need for new fiscal stimulus.

There is broad agreement in Europe that the continent is currently experiencing the brunt of the global economic crisis, and that a slow recovery may soon be in sight.

"It seems these days and weeks (that) recession is at its worst, but hopefully next year we start coming out of it," said Czech Finance Minister Miroslaw Kalousek, who was chairing the meeting as holder of the EU's rotating presidency.

However, officials cautioned against reading too much into the positive signals that are beginning to emerge from the United States and China.

"Hopefully, the light at the end of the tunnel is not a train (travelling) in the opposite direction," Kalousek said.

During their meeting in Brussels, ministers were also expected to formally endorse a decision taken by EU heads of state and government in March to double to 50 billion euros (67 billion dollars) the total amount of lending available to member states that run into financial difficulty.

The EU has already provided billions of euros in emergency loans to Hungary and Latvia and is currently discussing a similar request by Romania.

Finally, ministers were set to seek a political agreement on a compromise tabled by the Czech presidency aimed at raising the minimum level of taxes applied by member states on tobacco products.

The price of a packet of cigarettes currently varies widely within the 27-member bloc. (dpa)