1917 GMT: Eurozone leaders are ready to increase the firepower of its bailout fund "several fold" but will not give a headline figure, according to an EU source who is familiar with a draft version of the agreement that could emerge from the ongoing crisis summit.
1901 GMT: The eurozone leaders are now sitting down to a late dinner, diplomats say. No word yet on what's on the menu.
1852 GMT: Britain's David Cameron has been speaking in a bit more detail about the EU plan to recapitalise banks.
"We made good progress on the bank recapitalisation. That wasn't watered down. It now has been agreed," he said.
"It will only go ahead when the other parts of the full package go ahead -- and further progress on that needs to happen tonight."
1846 GMT: Reinfeldt, the Swedish prime minister, was pessimistic when he spoke to reporters after the start of the summit.
"I don't think we will get a final solution tonight," he said, because the summit is dealing with things "technically very difficult" as well as "enormous amounts of money." He said he thought "it's better to do it slowly in a way which creates long term confidence in the markets."
1843 GMT According to a senior government source, France is in favour of China taking part in efforts to stem the eurozone debt crisis by helping boost its bailout resources.
Sarkozy will telephone China's President Hu Jintao on Thursday, the source added.
1836 GMT: We are now hearing that France favours Chinese aid for the eurozone. More on that in a moment.
1835 GMT: A senior government source in Brussels says that Sarkozy and Merkel will Wednesday talk in person to world bankers to negotiate a "haircut" on Greek debt.
The source -- who is close to the talks but spoke on condition of anonymity -- said EU leaders were ready from Wednesday evening Brussels time to talk to the banks to cut a deal on the size of a debt writedown.
1825 GMT: EU leaders have agreed a plan to recapitalise banks to enable them to withstand Europe's debt crisis, my colleagues in Brussels are reporting
But British Prime Minister David Cameron said the plan will only go ahead once eurozone leaders agree a "full package" of measures to protect the euro at their ongoing summit.
1807 GMT: Italy is telling its European partners that it will present a growth plan by November 15, its domestic ANSA news agency is reporting, citing a letter of intent from Berlusconi to the Brussels summit. The letter also reportedly includes a proposal to raise the retirement age to 67 from 2026 -- a measure negotiated with the prime minister's Northern League coalition partner.
1803 GMT: Spanish journalists in Brussels are taking five-euro bets on the time that the summit will end. The most optimistic put their money on 10 p.m. Brussels time (2000 GMT); the most pessimistic, 3 a.m. on Thursday if not later.
1800 GMT: The eurosceptic Open Europe think tank is, well, sceptical about the summit. This from their blog: "The hope for a 'comprehensive plan' to save the eurozone, as originally touted by the eurozone leaders, looks to be a lost cause. The best outcome we can hope for today looks to be a broad political agreement, with technical details left to be sorted at a later date."
1744 GMT: The leaders of the EU member states that do not use the euro, including Britain, have left the summit chamber, leaving the euro zone to tackle the challenge at hand.
1740 GMT: Images of the leaders arriving for the Brussels summit have gone up on the European Council's television website (tvnewsroom.consilium.europa.eu). From the cameras' vantage points, it seems that most of the leaders arrived without making statements, with the notable exception of Swedish Prime Minister Frederik Reinfeldt, who spoke for about 20 minutes -- and Sweden doesn't use the euro. And when Angela Merkel said that much remains to be done, it was understood that the night would be long -- and the results less than decisive.
1723 GMT: This observation from AFP's Laurent Thomet: The man under the debt spolight, Italian Prime Minister Silvio Berlusconi, waved and smiled at reporters when he arrived at the summit, but he ignored their questions. With one associate privately nicknaming him Nero, after the Roman emperor who fiddled while Rome burned, Berlusconi was under pressure from eurozone partners to bring a written pledge that he will implement measures to slash the country's 1.9-trillion-euro debt."
1714 GMT: And there's this from Irish Prime Minister Enda Kenny: "The important thing here is that the full flexibility of the facilities that have been approved already be used now to bring certainty, and certainty of intent, for everybody."
Kenny added that it was his understanding that "some progress" had been made in a number of areas -- but which ones, he did not say.
1710 GMT: On his way into the summit, Poland's Donald Tusk said: "Everybody is waiting impatiently for the details, because it's all hell, not the devil, in those details."
1705 GMT: The summit got underway about 20 minutes late on account of a last-minute huddle between Merkel and Sarkozy.
1700 GMT: AFP's Christian Spillman, quoting a minister anonymously, tweets (and I translate from the French here): "The eurozone at an impasse. No agreement with the banks. A Plan B is under study to avoid a massacre in the markets."
1656 GMT: Belgian Prime Minister Yves Leterme -- a key player in the rescue of the Dexia bank earlier this month -- told reporters he hoped the summit would produce an outcome before financial markets in Europe reopen on Thursday.
1635 GMT: The summit is now under way.
1622 GMT: My colleague Claire Rosemberg reports: "As leaders prepare to open. Merkel is the last to sit down."
1612 GMT: "We are near the moment of truth. We must today take tangible decisions," said Luxembourg's long-serving prime minister Jean-Claude Juncker, who heads the 17-nation euro-group of finance ministers.
1555 GMT: There's mixed reaction from closing European stock markets after a day of choppy trade.
In Paris, the CAC-40 slipped 0.15 percent to 3,169.62 points and in Frankfurt the DAX 30 fell 0.51 percent at 6,016.07 points.
In London, the FTSE-100 index of top companies closed up 0.50 percent at 5,553.24 points.
There's currently a spectacular rainbow over the city's financial district, but maybe that's a coincidence.
1550 GMT: Elsewhere in Europe, Latvian Finance Minister Andris Vilks says his country is on track to meet its 2014 target for adopting the euro.
Without referring to the debt crisis and the last ditch efforts to resolve it, Vilks said that inflation, one of the tests for bloc entrants, was seen as a concern but it was unlikely to upset Latvia's plans.
"I feel that we will technically meet the criteria and we will be able to react if inflation grows," said Vilks, whose austerity-focused government was sworn in for a new term yesterday.
1547 GMT: "Our challenge today is not simply to save euro" but to "safeguard the ideals we cherish so much in Europe" post-World War II, Papandreou says.
1545 GMT: The summit is about "saving the euro", Greek Prime Minister George Papandreou says on arrival.
1542 GMT: A steady stream of leaders and officials arriving at the EU's Justus Lipsius building in Brussels now.
1530 GMT: Cameron, who on Monday saw 79 of his Conservative lawmakers defy his orders to vote against a referendum on continued British membership of the EU, had fought for non-eurozone member states like Britain to be given a place at the summit.
"Some of the issues we will be discussing this afternoon are directly relevant to Britain in terms of strenghthening banks across Europe," he said, referring to negotiations both to write down scores of billions of euros in Greek debt and recapitalise the sector.
The London vote took place against a backdrop of intense negotiations on the eurozone debt crisis, which prompted French President Nicolas Sarkozy to criticise Cameron for interfering in the currency bloc's business during a stormy first Brussels summit on Sunday.
1520 GMT: On the forex markets, the euro hit a seven-week dollar high this afternoon. At 1315 GMT, the European single currency hit $1.3975, the highest level since September 8. But soon afterwards it sank as low as $1.3865 in volatile trade. That compared with $1.3904 in New York late on Tuesday.
1517 GMT: British Prime Minister David Cameron has also arrived, citing "British interests".
"I'm very glad to be here because it is in British interests that we actually solve this crisis," Cameron has told reporters. "But in any event, we need to have the greatest possible support for the most comprehensive solution possible and that's what we will be discussing tonight."
1515 GMT: "In any case, we are all coming here with the aim of achieving great progress," Merkel adds.
She also acknowledged that all details might not be worked out by the end of the summit, despite an initial bid to agree a grand plan to contain the crisis which could then be presented at the G20 summit next week in France.
1507 GMT: German Chancellor Angela Merkel has arrived. "There are still many problems to settle and negotiations to carry out, so the work is not yet over," she tells reporters.
1500 GMT: Welcome to AFP's live coverage of events in Brussels, where European leaders are holding a crucial summit on the eurozone debt crisis.
With an hour to go before the summit opens, we'll bring you live updates from Brussels and reaction from around the world.
Here's a summary of key recent developments:
- Hopes are dimming that the gathering of European presidents and prime ministers will come up with a watertight deal to ward off fears of global recession.
- Draft conclusions leaked ahead of the talks show no deal on a figure for recapitalisation needs of banks. Finance ministers had given broad agreement to a 108-billion-euro ($150 billion) recapitalisation tab last week.
- Senior diplomats have warned that negotiations with banks on a big write-down of Greek debt are proceeding slowly and that plans to boost Europe's bailout fund remain unclear.
- But China has injected a note of hope that the eurozone may be able to beef up the fund -- which currently stands at 440 million euros -- to more than a trillion euros, which would enable it to rescue large economies such as Italy and Spain. Top EU diplomats tell AFP that China has agreed to invest in the European Financial Stability Facility (EFSF), a clear signal that attempts to solve the eurozone crisis are truly global.
- Russia has also offered to help boost the size of the bailout fund by acting with other countries through the International Monetary Fund.
- Global powers, from the United States to Japan and China, have pressed European leaders for a lasting solution to the debt crisis, ahead of the G20 summit in France on November 3 and 4.
- The spotlight will be firmly on Italian Prime Minister Silvio Berlusconi, who was told by his peers after a first summit on Sunday to return to Brussels with proof of rapid action to cut a debt mountain six times the size of that in Greece.
- Italian media report that Berlusconi has brought a 15-page letter outlining plans for reforms -- including a last-minute agreement with his Northern League coalition partner to raise the retirement age from 65 to 67 in 2026 -- with him to Brussels today.