World

Photo: The Canadian Press. All rights reserved.

FILE - In this Friday, Dec. 9, 2011 file photo European Council President Herman Van Rompuy, right, and European Commission President Jose Manuel Barroso participate in a media conference at an EU summit in Brussels. (AP Photo/Virginia Mayo, File)

The European Union won the Nobel Peace Prize for fostering peace on a continent ravaged by war, yet the Norwegian prize jury warned Friday that the financial crisis challenging the bloc's unity could lead to a return to "extremism and nationalism."

The award was hailed at the EU headquarters in Brussels and by pro-EU government leaders across Europe, but derided by "euroskeptics" who consider the EU an elitist superstate that strips citizens of their rights and erodes national identities.

The EU grew out of the tremendous devastation of World War II, fueled by the conviction that ever-closer economic ties would make sure that century-old enemies never turned on each other again. It's now made up of 500 million people in 27 nations, with other nations lined up, waiting to join.

But European unity is being threatened by the debt crisis that has stirred deep tensions between north and south, caused unemployment to soar and sent hundreds of thousands of its citizens into the streets to protest tax hikes and job cuts.

The bloc's financial disarray is threatening the euro, the common currency used by 17 of its members, and even the structure of the union itself. The debt crisis is also fueling the rise of extremist movements such as Golden Dawn in Greece. The party, which opponents brand as neo-Nazi, has soared in popularity as Greece sinks deeper into a debt-fueled morass.