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Tuesday, December 1, 1998 Published at 10:27 GMT

World: Europe

Analysis: Britain tests the Franco-German axis

The European Union: Is Britain one of those in the driving seat?

By European Affairs Analyst William Horsley

[ image: William Horsley]
William Horsley
Two's company, three's a crowd. That old saying seems to be borne out by the constant frictions that make themselves felt in the uneasy triangle among the three most influential countries of western Europe, France, Germany and Britain.

Ever since the Elysee Treaty of 1963, France and Germany have deliberately formed an exclusive partnership, which they like to call an axis, or "engine" of European integration.

This claim to joint leadership faces its greatest test yet with two recent events - the arrival of Tony Blair's more pro-European government in Britain last year, and the election in September of Gerhard Schroeder as German Chancellor.

[ image: Former German Chancellor Helmut Kohl and French President Jacques Chirac: Great allies]
Former German Chancellor Helmut Kohl and French President Jacques Chirac: Great allies
Mr Schroeder says he is committed to giving the UK, too, a seat in the inner circle of decision-makers, and to using Britain's experience with flexible, free-market economic reforms to benefit the whole of Europe.

In fact, the existence of these two rival German agendas - for special relationships with France and with Britain - is causing new confusion as the EU faces critical decisions in three big areas: economic union, political union and the idea of a common European defence.

  • First, economic union, as an accompaniment to the currency union that takes place among eleven EU states, but not Britain, next January. Mr Schroeder's left-wing finance minister, Oskar Lafontaine, has started a shift in economic policy in the EU away from the strict monetarism embodied by the German Bundesbank, and towards more state spending aimed at cutting unemployment.

    He is also pushing for a federal agenda - namely, for all European Union states to harmonise their tax systems, and adopt similar welfare and environmental policies.

    These moves are controversial on mainland Europe; but in Britain they have caused near-outrage.

  • As for the idea of an eventual political union in Europe, Mr Schroeder has made clear he will pursue this goal in much the same way as his predecessor Helmut Kohl. And the new German foreign minister Joschka Fischer has said he looks forward to the birth of something like a European state. The French, meanwhile are more eager than ever to hand over more national competences to EU institutions (for example, by taking more decisions by majority voting). But Mr Blair's Britain is much more cautious. So here, too, Britain appears doomed to oppose the moves of the others.

  • Only when it comes to military matters does Britain clearly have a strong hand. Tony Blair has proposed a shake-up of European defence structures to give Europe a more coherent role in tackling international crises like those over Bosnia and Iraq.

    On this count, Britain still faces big - even perhaps insuperable - problems in dealing with the Franco-German axis in the most vital European questions of the single currency and political union.

Budget tensions

[ image: Can Tony Blair gain more influence?]
Can Tony Blair gain more influence?
But there's one more issue which has the power to turn each of the fifteen EU member-states against one another.

That is the financing of the EU budget from the year 2000 on. Germany is fighting to cut its huge contribution. France is fighting to keep as much as it can of the present support for farming. Britain insists on keeping its special rebate.

The arguments may overshadow both Franco-German and Anglo-French talks. And the tough job of reaching an accord acceptable to all is in the lap of the Germans, who hold the EU presidency in the first half of next year.

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