Today's Date:

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You know the importance which I personally attach to relations between France and Germany. (...)

On the eve of the major enlargement, I am more convinced than ever that there is no alternative for France, for Germany, or for Europe to Franco-German entente.

Both during the German EU presidency in 1999 and the French one last year, we saw for ourselves how difficult it has become for the Fifteen to negotiate consensual solutions on important issues, although such agreement is an absolute constitutional and democratic necessity. Our Franco-German entente must therefore be clear-sighted, concrete and steadfast, founded on the realities of our two countries today and the vision of the Europe we want. It is demanding and irreplaceable, which doesn't of course mean that it is exclusive or sufficient. (...) You are very familiar with these major issues facing both France and Germany: introduction of euro notes and coins next year and consequent process of increased economic policy coordination; all the day-to-day security and judicial matters which necessitate real cooperation between our police and judiciary; building of the European security and defence policy, which we absolutely must bring to a successful conclusion; development, sphere by sphere, of a common foreign policy, which remains a long-term task but in which there have been undisputed advances. You only have to look at the degree to which the Fifteen today see eye to eye on the Balkans. On all these points, there is progress. But I would like to explore more deeply with you two other great - and particularly important - issues which, depending on how they are handled, will determine all the others: enlargement and the future of the European Union.

ENLARGEMENT

On enlargement, I am delighted that, under the Portuguese and French presidencies, we really did manage to speed up accession negotiations and have done so even more - since, and thanks to Nice - with the Swedish presidency. Happily, decisions taken at the Helsinki European Council had ended many years of relative confusion.

It was indeed evident, from the beginning of the nineties, that the accession applications by the new European democracies would have to be accepted and even that they offered all Europeans a historic opportunity. But it was also clear back then that none of the countries concerned would be ready for a long time to take on board the extraordinarily demanding rules for participation in the Union, the acquis communautaire, and that the EU itself would not be in a position to take them in without preliminary reforms. So the practical questions were: when do we negotiate? On what? How? What reforms must the EU itself first carry out? How are the candidate States preparing themselves?

Had the Fifteen, the Commission and the candidates concentrated earlier on the replies to be given to these specific questions, we might well have avoided unnecessary polemics along the lines of "who is for or against enlargement?" and unjustified criticism. We might not have fuelled the anxieties and illusions, both equally groundless. Today, in any case, we have a clear policy, which is the right one: thorough and focused negotiations, based on the principle of differentiation, i.e. on each candidate's merits and preparedness, and the progress achieved in the negotiations. Since it's the most convenient method, the Commission is working chapter by chapter and we are trying to go as far as possible on each by finding solutions to the difficulties, some more serious than others, which emerge. At the same time, we must bear in mind that it is countries we are bringing in, not chapters. That means that the chapters closed provisionally are subject to the final agreement achieved country by country. (...)

For several years people have been talking about setting the accession dates in advance. I believe that this is increasingly becoming a spurious problem. What dates? For which country? For all or some of them? How do we decide without causing harm? (...) The important thing is for the European Union to be ready in 2003 and that, from then on, as soon as everything has been settled with a given candidate country, it will be able to join. (...) So France is happy to have, in Nice, helped get agreement between the Fifteen on problems which had remained unresolved for years, which allows us now to make faster and more viable progress towards enlargement, which is extremely close, and to debate the future of the enlarged Europe, which I'd like to say a few words about now.

EUROPEAN INSTITUTIONS

Once the Treaty of Nice had been achieved, a new IGC was needed in order to respond to the ever-more pressing desire for clarity, democracy and accountability in decision-making in the enlarged Europe. (...) It had become necessary to get to grips with these problems. Chancellor Schröder was right to propose this to the Fifteen in Nice and we were right to decide to conclude this process in 2004.

The most important debate in the history of the European enterprise has thus been opened, the first to concern virtually all Europe's countries, the first also to involve all Europe's citizens. It is a hugely ambitious undertaking whose organization must ensure that the debate is neither trespassed on, nor bypassed by premature conclusions and it needs time if we want it to be genuinely democratic. Three years will not be too much for that. In Nice we decided on the first elements: starting this year, democratic debates in every European State which are to be as broad as possible. In France, we have already organized this, launched it and got it going in such a way as to ensure the involvement of all the French throughout 2001 and perhaps beyond. Beginning in 2002 and continuing in 2003, there is to be a more structured debate at European level to prepare the next IGC - perhaps a convention under conditions yet to be defined, but other ways of conducting it are also possible - scheduled to be launched at next December's Laeken European Council, then at the end of 2003 or beginning of 2004, an IGC to come to decisions and a European Council to conclude the process. The end result may be a Constitution, if the Fifteen agree on what the word means.

Of course, our priority is the purpose of our Union, why we are together, our objectives, what we do even more than the way we do it. The French Prime Minister will shortly give his views on both. But this afternoon, I would like to share with you some thoughts on the institutions.

INSTITUTIONS

- Our point of departure is that in fact the EU already constitutes a federation of nation-States. It combines federal elements, of which the euro will be the strongest symbol, and sovereign nations that there is no question of doing away with.

So the problem is not so much what to call our European project, but what answers we are going to give to two important questions: how do we divide the responsibilities and powers between Europe and the member States? And how do we organize power at the European level?

- In Nice we set ourselves the ambitious objective of reaching agreement on a precise division of powers and responsibilities. The right one won't automatically emerge from the words "federation", "constitution", and "subsidiarity", even though they express policy directions and values. In fact, each of them can cover very different realities. Thus a Constitution can just as easily limit the power of the Federation as those of the federated entities. A federalist model can involve the integration of a large or very small number of policies, which can themselves be the subject of a greater or lesser degree of integration.

Finally, not all policies necessarily affect every member State, and this is an additional parameter to consider when allocating responsibilities. It is through negotiation, not a futile attempt to apply ready-made formulas, that we shall have to find a balanced solution.

- The debate on the organization of power must also start from what the EU actually is at the moment and what has permitted its progress: the balanced Council/Commission/Parliament institutional triangle, together with the decisions of the Court of Justice form the Community system and have given the European enterprise its dynamism and its originality. (...)

Does the major enlargement, which will radically change the EU, mean that we'll have to modify this system? I believe it would be dangerous to upset this balance, which has proved itself.

Admittedly, it will very probably be necessary to strengthen the European Parliament and the Commission and go further than we decided in Nice. There are already proposals along these lines for these two institutions. In this respect, even though, for various reasons, France's position can't be the same, I welcome the SPD's recent contribution to this debate.

I note, however, that the SPD's proposal would clearly upset the balance to the detriment of the Council and the member States. I, on the contrary, am convinced that all the European institutions will have to be strengthened. If we were to strengthen only one or two sides of the triangle, we would jeopardize the effectiveness of a system which has demonstrated its value and very probably end up with deadlock between the Fifteen.

I think that the more we strengthen the Parliament and Commission, the less we shall reduce the Council to the role of a second chamber. In fact, we shall have to strengthen and modernize it as much for reasons of accountability, political representativeness and democracy as of efficiency.

- We must also decide on how European policies should be managed. The general rule is for the Commission to manage them, in conformity with the rules set by the Council in agreement with the Parliament. But some policies will, for an indefinite period, be managed by the Governments together. That does not mean less efficiency or ambition, but that these intergovernmental procedures will themselves have to be reformed and modernized.

At this stage, let us be honest enough to acknowledge that in Europe we don't as yet all have the same positions on the division of powers and the nature of European power because the ideas behind them are so very different, but let's make sure we are sufficiently bold, inspired and ambitious to come together for 2004./.