Sept 11 - European Commission President Barroso says the EU faces big obstacles as it sets off on the path to recovery. David Pollard reports.
Europe's parliament - monument to the federal ambitions of a different, pre-crisis era. But it was the current state of the union and its challenges that brought Jose Manuel Barroso there this time. The European Commission president spoke of big risks ahead - not just economic. Europe's governments had to take the lead. (SOUNDBITE) (English) EUROPEAN COMMISSION PRESIDENT JOSE MANUEL BARROSO, SAYING: "The biggest downside risk I see is, you know what, is political -- this is the biggest downside risk we have. In this phase of the crisis, governments' job is to provide the certainty and predictability that markets still lack." Barroso also warned against complacency. Unemployment was still at record levels. Europe should not expect to go back to the good old days. (SOUNDBITE) (English) EUROPEAN COMMISSION PRESIDENT JOSE MANUEL BARROSO, SAYING: "Some people believe that after this, everything will come back as it was before. They are wrong, this crisis is different." His caution has prompted further questions over the recent rise in European asset prices. Credit Agricole's Adam Myers says they could be overbought - look out! (SOUNDBITE) (English) ADAM MYERS, SENIOR MARKET STRATEGIST, CREDIT AGRICOLE-CIB, SAYING: "I think some the gains we have seen in stocks and some of the gains we have seen in currencies are probably unjustified and could reverse." There was one sop to investors. Barroso announced a set of measures to free up telecoms markets. Just one small move, he said, to nurture a "fragile recovery".