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Germany/France: Leaders Will Fight To Cut Unemployment

Prague, 1 December 1998 (RFE/RL) -- German and French leaders agreed today that the fight against Europe's high unemployment rates should be Europe's top priority.

A declaration issued after a two-day summit meeting in Potsdam agreed that the "fight against unemployment should be at the centre of European politics." The declaration urged the 15 member-governments of the European Union to set binding goals for putting their citizens back to work, with the emphasis on women, young people and the long-term unemployed.

It said France and Germany believed it necessary to complement the European Union's tough agreements to ensure the stability of monetary union with a European employment pact.

Correspondents said the statement was the main result of the meeting at which German Chancellor Gerhard Schroeder met both French Prime Minister Lionel Jospin and President Jacques Chirac.

In both Germany and France unemployment has soared to more than 10 per cent of the workforce and most analysts see little hope of it diminishing in the coming year. The same gloomy situation applies in most other European Union countries. The worst hit is Spain where the official unemployment figure is 18.6 per cent.

Correspondents said the statement illustrated a different approach by the new socialist German chancellor to his conservative predecessor Helmut Kohl. Despite being a strong supporter of a united Europe, Kohl believed that combating unemployment should be handled by individual national governments although he acknowledged it could be discussed by the European Union. On several occasions he rejected a European employment pact.

These bilateral meetings between the leaders of France and Germany take place twice a year. But this one was considered exceptional in that it comes just as the new European currency is about to be launched on January 1 and as Germany prepares to take the post of European Union president for six months, beginning in January.

Schroeder has pledged himself to try to implement far-reaching reforms within the organization during Germany's term. It was hoped the meeting with the French leaders yesterday and today would help develop a common approach to some problems.

The communique gave little indication of what concrete measures may have been considered on such problems as reforming the Common Agricultural Policy, which pays subsidies to farmers, and the reform of several European Union institutions.

However, it did say that the French and German leaders had pledged to seek common European policies on taxes. Commentators said this could bring them into conflict with Britain. The British Chancellor of the Exchequer (finance minister) Gordon Brown said yesterday it was opposed to any effort to harmonize direct taxes. Many British taxes are lower than those in other countries.

The French and German leaders also discussed Germany's desire to reduce its contribution to the European budget. Germany is the biggest net contributor to the budget. Its annual net contributions amount to 21,000 million marks ($12.4 billion) compared to just 800 million marks paid by France. Schroeder said earlier today that France had expressed understanding for Germany's desires but there had been no agreement on how Germany's contribution could be reduced. All 15 members of the European Union would have to agree before there could be a change. Schroeder and the French leaders also discussed some industrial and business problems, such as plans to merge the European aerospace industries to compete with the U.S. giants. The British and German aerospace negotiations are fairly advanced but problems remain in including the partly state-owned French industry.

Commentators said the tone of the final declaration stressed that Germany and France intended to remain the motor of Europe's drive to more unity. The declaration said: "on the threshold of the 21st Century, we are determined to deepen our relations in the interest of European unity and to give them fresh momentum."