Risk of new recession in Europe

The European Union has drastically cut its growth forecast for the eurozone in 2012, from 1.8% down to just 0.5%.

"Growth has stalled in Europe and there is a risk of a new recession," said European Commissioner Olli Rehn.

The low growth makes it harder for Europe to escape its debt crisis, with Italy's position seen as unsustainable.

Global stock markets are tumbling and some are hoping China could come to Europe's aid by contributing to its bailout fund.

Martin Patience reports from Beijing.