EU Motor into Overdrive: France and Germany Get Ever Cosier

Once strained Franco-German relations got even cosier on Thursday evening when the French Prime Minister, Pierre Raffarin and German Chancellor, Gerhard Schröder met in Berlin to finalize plans for a historic joint session of their parliaments.

The session – part of celebrations marking the 40th anniversary of the “Elysee Treaty” - is planned for January 22nd and will see German Bundestag and the French National Assembly come together in the Versailles palace on the outskirts of Paris.

The session is to be broadcast live on Franco-German bilingual channel, “Arte” and Schröder and Chirac are expected to announce a joint commitment to act in concert during the two years Germany holds a seat in the UN Security Council.

Ever closer union

The current union between France and Germany is a massive turnaround from the state of relations just six months ago and far closer to the spirit of the treaty both states signed in 1963.

Under the terms of the treaty, France and Germany promised to end rivalries and work together towards creating new Europe. They also agreed to consult each other “on all important questions of foreign policy with a view to arriving… at a similar position.” Additionally, French and German heads of state and government agreed to meet every six months.

But until now, the French and German premiers have had an, at best, frosty relationship. France has feared German domination of central and eastern Europe as the EU expands and disagreed with Berlin’s calls for more supranational powers for the EU.

Both also have different positions on a potential war with Iraq. Germany still refuses to take any part in the possible conflict, whereas France has told its troops to be ready for war.

Nevertheless, the new developments now see the two super-charging the Franco-German engine often said to be the power driving the European Union.

Driving the EU

Earlier this week, Gerhard Schröder and French President Jacques Chirac struck a historic deal on a future shake-up of EU institutions and even discussed the possibility of sending ministers to each other’s cabinet meetings in future.

Compromising on their competing visions for the future of the EU, both states agreed to jointly push for expanded powers for heads of both the European Commission and European Council.

Coming through together

The deepening bond has much to do with the common economic challenges both are facing currently.

Germany, with a budget deficit of 3.75% of GDP, unemployment at a four-year high of 4.2 million and in the depths of recession, has already been disciplined by the EU for breaking the rules of the Stability Pact. Similarly, France’s budget deficit is already nudging the 3% ceiling and is also suffering from sluggish economic growth and both countries now urgently face reforming their welfare states and rigid labor markets.

“We’re both in the same situation and we both have to come out of it together,” Schröder said after the meeting.

Both premiers said that the Stability Pact was important for the future of the Eurozone, but were clear that keeping budget deficits within the 3% ceiling was not the only objective.

“The rate of inflation, growth, and battling unemployment are just as important,” Schröder said.

They also said that the Euro, which strengthened against the U.S. Dollar posed no danger to both the French and German export industry.