Merkel, Sarkozy meet amid euro crisis

The French and German leaders meet on Monday in Paris for annual talks in which they will seek further economic coordination in the crisis-hit European Union and discuss the escalating violence in Syria.

Chancellor Angela Merkel, who is openly backing President Nicolas Sarkozy in April’s presidential election, will also give a joint interview with Sarkozy to French and German television networks in the evening.

“The meeting will be dedicated to deepening Franco-German cooperation in all fields … and notably fiscal convergence,» the French presidency said in a statement.

The German chancellor is seen in France as a trustworthy leader capable of dealing with the euro zone debt crisis, and so could boost Sarkozy’s credibility on economic issues.

French Finance Minister Francois Baroin said Merkel’s visit, which takes place as Greece struggles to avoid a chaotic debt default that would have repercussions across Europe, was to ensure the bloc’s main drivers were on the same page.

“As we are the two main contributors (to the euro zone) if you don’t have an accord between France and Germany you can be sure not only of Europe’s slow descent in international competition, but into chaos,» he told Europe 1 radio.

“No agreement between the two means no engine.”

German government officials said the meeting would focus on corporate tax harmonization, one aspect of Berlin and Paris’ goal to drive economic coordination within the EU.

The meeting would produce a «green paper» – intended to stimulate debate on the subject within the European Union – that aims to make it easier for small- and mid-sized companies to work across borders.

“It is also important to bring to life these agreements made by the Council of the European Union on growth and employment,» said Berlin’s new coordinator for German-French relations, Michael Link.

“We must show that bilateral relations are not a museum object, and have a very lively political character.”

The intergovernmental meeting includes separate talks between various ministers including foreign policy chiefs Alain Juppe and Guido Westerwelle. It will be followed by a joint news conference at 12:45 p.m. (1145 GMT).

Sources said discussions would also focus on how Europe will act on developments in Syria after Russia and China vetoed a U..N. resolution, backed by France and Germany, that would have supported an Arab plan urging Syrian President Bashar al-Assad to give up power.

“European and international subjects will also be discussed during these discussions,» Sarkozy’s office said. Sarkozy said France was consulting with Arab and European countries to create a contact group on Syria to find a solution to its crisis. [Reuters]