German Chancellor Angela Merkel met new French President Francois Hollande yesterday for their first-ever talks set to be dominated by differences over crisis remedies for Europe as the risk of a Greek eurozone exit piles on the pressure.
After the collapse of talks in Athens on forming a new government, forcing new elections, Mrs Merkel will have to overcome a rift with the newly sworn-in French leader over the eurozone’s economic roadmap.
Mr Hollande was sworn in as President of France yesterday morning with a solemn vow to find a new growth-led strategy to end the crippling debt crisis threatening to unravel the eurozone.
After brief ceremonies and a rain-lashed walkabout, the 57-year-old Socialist headed to Berlin to confront Chancellor Angela Merkel over their very different visions as to how to save the single currency bloc.
Hollande’s plane was hit by lightning shortly after takeoff and returned to Paris, but the president left again shortly afterwards in a different jet.
He finally arrived at Mrs Merkel’s chancellery in light rain, shaking hands with the German leader and chatting before walking up a red carpet to a podium where the French and German national anthems were played by a military band.
Their talks which lasted for around one hour were followed by a news conference and working dinner.
While Mrs Merkel has championed austerity through belt-tightening and debt reduction to battle the crisis dogging the 17-nation eurozone, the Socialist Mr Hollande swept to victory on a pledge to refocus EU fiscal efforts on growth.
Since his May 6 routing of Nicolas Sarkozy, both Berlin and Paris have publicly dug their heels in over their respective positions, talking tough on policy ahead of their meeting.
Just hours before his arrival, Hollande reiterated his vow to turn the page on austerity and invest for the future, saying he would propose to France’s partners “a new pact that links a necessary reduction in public debt with indispensable economic stimulus”.
But with financial markets and international partners seeking reassurance that Europe’s traditional Franco-German engine will continue to drive the eurozone, the pair are under pressure to find common ground.
Mrs Merkel has played down expectations for the meeting, saying it will be about the two leaders getting acquainted rather than a major decision-making summit.
She has said she would welcome the Socialist President “with open arms” despite having openly supported her fellow conservative and ally on the euro crisis, Mr Sarkozy, for the presidency.
Mr Hollande has argued that austerity is no longer “the only option”, ruffling feathers in Berlin which drove through the EU fiscal pact enshrining tougher budget discipline for the 25 of the 27 EU members who signed up to it.
He vowed during his election campaign to reopen talks on the pact prompting repeated warnings by the German government that the accord, which has already been ratified by some EU states, is not open for renegotiation. But observers see room for compromise, with Mr Hollande likely to agree to additional stimulus measures without a rewrite of the pact.
“In the euro crisis, the pair has no choice but to get along,” news weekly Spiegel Online said, noting their future as heads of Europe’s two biggest economies would be “pegged to one another”.
“Berlin and Paris have carefully worked out the scope for compromises,” Die Welt newspaper said, adding that Mr Hollande wanted to soften Mrs Merkel’s “savings diktat”.