European finance ministers yesterday expressed confidence that the EU, particularly the euro area, will not be severely affected by the turmoil in world financial markets.

Following their monthly meeting in Brussels, the 27 finance ministers appealed for calm.

"Europe's economy is in a good shape," European Economic and Monetary Affairs Commissioner Joaquin Almunia told a press conference after the meeting.

"We have a positive current account position. We have a level of savings that is the level required to finance our investments. We have improved our fiscal positions a lot. Moreover, we haven't got sub-prime mortgages in our financial systems," Mr Almunia said.

Speaking just minutes after a surprise announcement by the US Federal Reserve of a 0.75 percentage point cut in interest rates, Mr Almunia said he sees no valid reason why the European Central Bank should emulate such a move.

"The main reason for the turmoil is the risk of a recession in the US. It's not about a global recession. It's about a recession in the US because big imbalances have built up over the years in the US economy. A big current account deficit, a big fiscal deficit and a lack of savings," Mr Almunia said. "Our situation is very different."

Speaking to The Times, Parliamentary Secretary Tonio Fenech, representing Malta at yesterday's meeting, said that although the EU is concerned about what is happening there are no signs of a global recession.

"From the data and analyses we were given, Europe's economy is performing and the same goes for Asia. This does not mean that we won't be affected by a possible US recession but we can resist much more. Our economy is on a sounder footing," he said.

The agenda of yesterday's meeting included the entry of Malta and Cyprus into the eurozone.

Mr Fenech said that both the Commission and the other eurozone member states praised the way Malta has implemented this important step and the measures being adopted by the authorities, particularly the National Euro Changeover Committee, to make sure that no price abuses take place.

"We have had very positive feedback from the EU so far and it is our intention to continue informing our colleagues about the progress being achieved during these first crucial months of the changeover," he said.

The European Commission is next month expected to issue a full report on the Malta's changeover to the euro.