PARIS, Oct 4: The head of the International Monetary Fund (IMF) urged European leaders on Saturday to agree a coordinated approach to deal with the worst financial crisis since the 1930s.

“What counts above all is coordination and the will not to act each for himself as we have seen a little bit in some European cases,” Dominique Strauss-Kahn, the IMF’s managing director, told reporters after meeting French President Nicolas Sarkozy.

“The world economic situation is very worrying,” Strauss-Kahn added, saying the IMF would be cutting its world economic growth forecasts.

The $700 billion bailout approved by the US Congress is earmarked to buy up assets that turned toxic when the US housing market and sub-prime mortgage market collapsed.

Reported suggestions of a collective EU bank rescue fund of 300 billion euros ($415.7 billion) were leaked to media earlier in the week but squashed rapidly after strong objections from Germany and Britain.

Germany stepped up its opposition to any European rescue fund on Saturday.

“I do not think it can be justified in this situation to ask the state to restore trust that has been gambled away with large-scale debt relief plans financed by tax money,” Economy Minister Michael Glos told Bild, a Sonntag newspaper.

Before the summit, Britain’s Brown urged Europe to aid small businesses through a 12 billion pound ($21.2 billion) fund from the European Investment Bank.

The EIB has said the money would be spread over two years, but Brown wants the funds made available immediately.

EU member Finland strongly criticised Sarkozy’s summit saying all European countries should have a say on how to resolve the crisis rather than just the bigger nations.

“In my opinion it’s a very bad idea,” Finance Minister Jyrki Katainen told national Finnish broadcaster YLE.—Reuters