BRUSSELS - European leaders promised on Friday to provide developing countries with 7.3 billion euros ($10.8 billion) over three years to try to win their support for a climate change deal in Copenhagen.

Finance has emerged as a stumbling block to a global climate agreement to replace the Kyoto Protocol, which expires in 2012. But EU leaders, despite domestic budget concerns, said they were determined to provide an incentive for a deal.

Finance is key to getting this deal done, European Commission President Jose Manuel Barroso told reporters after the EU's 27 member states agreed to provide 2.43 billion euros a year to developing nations from 2010-2012.

Poor nations are unconvinced that industrialized states will fulfill pledges to help them tackle climate change. The EU hopes those suspicions might be set aside if wealthier countries can be convinced to pay up to 21 billion euros over the three years until the new agreement to replace Kyoto kicks in.

Such money might be used to curb carbon emissions, to develop drought-resistant crops or to find new water sources as wells dry up, all measures to alleviate possible climate damage.

Friday's agreement by EU leaders, hammered out over two-day meeting and after a final push for more contributions, would account for just over a third of the 21 billion euros.

It was possible through the night to get contributions from all 27 member states, said Swedish Prime Minister Fredrik Reinfeldt. We urge other developed parts of the world now to make the same contributions.

MOUNTING DEBT

The stepped-up pledges came despite the fact public finances in many EU countries are in disarray after the worst economic crisis in 60 years, with budget deficits and debt soaring.

Richer governments have poured tens of billions of euros into their economies to battle the crisis and save jobs, while Hungary, Latvia and Romania have been forced to seek aid from the International Monetary Fund and the European Commission.

The EU's climate financing agreement looked likely to fall short of target Friday morning, before Sweden, which holds the EU presidency until the end of the year, broke off talks and called for a renewed effort to increase pledges.

Britain, Spain and Italy then all decided to increase their contributions, those following the negotiations said, allowing the overall commitment to be raised to 7.3 billion euros over three years from a little over 6 billion euros.

Britain's pledge of 1.6 billion euros over three years and Sweden's of around 800 million stood out as the most generous compared to their current economic standing in the EU.

Britain's credit rating is currently a source of concern after it spent large sums on bailing out banks. Poverty campaign group Oxfam warned that much of the money had been found by raiding existing budgets for overseas development aid.

Each member state that has pledged a sum for the EU total should now own up to where the money will come from, whether it has already been committed elsewhere, and what it's to be used for, said Oxfam campaigner Tim Gore.

But Sweden said that at such short notice it was unavoidable that such money would have to be found in existing budgets.

Reinfeldt said Europe was serious in its pledge to increase its overall target for carbon emissions cuts, raising the barrier to a 30 percent cut below 1990 levels by 2020, rather than a 20 percent cut, but only if other rich regions follow.

We must see movement from other developed parts of the world before Europe is ready to move, he said, singling out Canada and the United States for criticism.

But we will show flexibility.

(Additional reporting by Marcin Grajewski)

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