EU makes progress on treaty, stuck on climate deal

BRUSSELS (Reuters) - The European Union reached a deal Thursday to help secure ratification of a treaty intended to increase its influence in world affairs but failed to agree on funding for a pact to combat climate change.

EU leaders accepted a demand by Czech President Vaclav Klaus for his country to have an opt-out from a charter on human rights which is attached to the bloc's Lisbon reform treaty, a Czech government spokesman said.

Klaus had demanded the opt-out as a condition for ratifying the treaty. The leaders' agreement is expected to remove one of the last obstacles to the document, which would streamline decision-making and create an EU president.

"The opt-out was approved as presented by the Swedish EU presidency," spokesman Roman Prorok said.

"All the leaders applauded and cheered," said a diplomat from Sweden, which has been negotiating the opt-out on behalf of the EU.

The treaty requires the backing of all 27 member states to go into force. All have ratified it except the Czech Republic.

Klaus wanted an opt-out from the Charter on Fundamental Rights to shield the Czech Republic from property claims by ethnic Germans expelled after World War Two.

Klaus did not immediately react to the EU leaders' decision. He is widely expected to ratify the treaty next month if the Czech constitutional court rejects a legal challenge to the document Tuesday.

The joy over the opt-out contrasted with the disappointment of many leaders over the failure to agree on funding to help poor countries combat global warming under a deal to be discussed at international talks in Copenhagen in December.

EU sources said the EU presidency would present new proposals Friday, the last day of the summit.

Failure to agree on the funding would be another blow to the prospects of global leaders agreeing on a successor to the Kyoto Protocol on battling climate change at the talks in Copenhagen.

"They didn't reach any agreement on climate. There was no real advance on any particular solution. They will take another look at it in the morning," said one EU official, speaking on condition of anonymity.

Nine countries in eastern Europe opposed any agreement on how much funding to give developing countries until the EU agrees on internal burden-sharing, the amount each state will provide.

(Writing by Timothy Heritage, additional reporting by Pete Harrison, David Brunnstrom, John O'Donnell, Bate Felix and Marcin Grajewski; Editing by Paul Casciato)