European Commission President Jose Manuel Barroso (search) said Thursday the European Union will donate euro100 million (US$132 million) for immediate tsunami relief and look at setting up a euro1 billion loan for affected nations.

Barroso said he also would ask the European Parliament (search) to approve another euro350 million (US$461 million) in aid for longer term reconstruction of countries devastated by the Dec. 26 disaster.

"I think the European Parliament is ready to be very generous," he said on the sidelines of the international donor summit in Jakarta.

The loan would be on "very favorable terms" and administered by the European Development Bank (search) and other international banks, he said.