This WEEK in the European Union

The collateral question - which threatened to become a crisis capable of sinking the entire second Greek bailout when others EU countries also demanded guarantees - now looks to be heading toward a solution. German, Dutch and Finnish finance ministers are expected meet to discuss the matter on Tuesday.

The big issues remain the same as before the summer break - how to convince markets that eurozone leaders have the political will to save the currency and getting parliamentary approval in 17 countries to make the bailout fund more flexible.

This would potentially release the European Central Bank from what some see as an unnaturally political role, started last year, of buying troubled government bonds.

Politics in paymaster Germany will continue to play centre-stage. MPs, due to vote on the expanded bailout fund on 29 September, are debating an idea that the Bundestag should be asked for its permission eveyr time the fund is used.

This could make markets - which abhor the unpredictability of democratic process - even jumpier.

Adding to the tension, Germany's highest court will on Wednesday decide on the legality of three EU-backed bailouts to Greece, Ireland and Portugal last year. The case has been brought by five academics and a eurosceptic MP from the Bavarian wing of Chancellor Merkel's centre-right party. The court has in past EU rulings strengthened the role of the German parliament in EU decision-making.

A day later, the European Central Bank (ECB) will have its regular council meeting. Last week, ECB chief Jean-Claude Trichet hinted the bank would not be raising its benchmark interest rate, after having raised it twice this year to 1.5 percent.

Six-pack, energy

The EU commission will on Wednesday publish a paper on the security on energy supply in which it is expected to call for more co-ordination among member states in their approach to external energy supplies - including in deals with major supplying countries such as Russia or third countries over which energy is transported.

Meanwhile, the European Parliament will be preparing for what is expected to be a busy plenary week beginning 12 September.

One of the most important issues that could be on the agenda - although it might be postponed until the second plenary session - is the so-called six-pack of economic governance legislation designed to prevent future crises.

So far MEPs and member states have been locked in disagreement over the automaticity of the sanctions for breaking fiscal rules. Mindful of the disastrous message that non-agreement would send out, the Polish EU presidency and the commission have been issuing increasingly shrill warnings about the need to find a compromise.

The assembly's foreign affairs committee will next week host Kovoso's president Atifete Jahjaga, at a time when tensions between the statelet and Serbia are running high. EU-brokered talks, meant to bring about some reconciliation between the former province and Belgrade, collapsed in July after a trade row led to violence in northern Kosovo. They resumed last week.

9/11

The end of the week also marks the tenth anniversary of the 9/11 terrorist attacks in Washington and New York.

The attacks resulted in the US-led war in Afghanistan, from which European nations are now trying to extract themselves.

They also led to the ramping-up of US anti-terror measures - dubbed the "war on terror" - hated by the European left.

Global politics have moved on, with America in danger of losing grip its claim to be the sole world superpower amid the rise of China among others. Meanwhile, the EU remains fitfully anxious about its place on the world stage and its ability to speak with one voice on issues such as Palestin'es upcoming UN bid.