LEADERS OF GERMANY and France met today to mark a seminal 1962 speech by Charles de Gaulle, hoping to use the occasion to make headway on the euro crisis and a mooted EADS-BAE systems merger.

Chancellor Angela Merkel and French President Francois Hollande met at the Baroque palace in Ludwigsburg, southwestern Germany, where De Gaulle addressed German youth in a groundbreaking gesture of post-war reconciliation.

Under overcast skies, Hollande told an audience of French and German citizens that European unity was the only way out of the eurozone debt turmoil lashing the common currency.

“The only response to the crisis is Europe, it is Europe that will beat the crisis,” he said in a speech given in French and wrapped up with a few words in German: “Long live the Franco-German friendship!”

(Image: Michael Probst/AP/Press Association Images)

Merkel finished her own speech with a line in French: “Long live Franco-German youth, long live European youth!”

The chancellor’s spokesman Steffen Seibert said the meeting would be largely ceremonial, but a few pressing topics were nevertheless to be discussed.

“The issue of EADS and BAE will certainly be addressed at the working lunch with President Hollande,” Seibert told reporters Friday, referring to the proposed tie-up to create the world’s top aeronautics group ahead of Boeing.

“There will of course be no decisions this Saturday and you should not go into the press conference expecting any.”

Merkel and Hollande, who have struggled to keep their initial friction to a minimum since the president took office in May for the sake of the EU and the euro, are to take reporters’ questions at around 3 pm (1300 GMT).

Seibert said they would also talk about tighter checks on the European banking sector, a focus of eurozone crisis-fighting at the moment.

Governments have been cautious since the announcement last week that the British defence group BAE and European aerospace behemoth EADS were negotiating a merger.

The French presidency has said it would only take decisions on the merger project when key details had been clarified.

Germany has also taken a wait-and-see approach, with some officials arguing that the bigger company would be better able to compete on the global market while others worry the fusion could end up costing good jobs.

The two groups have until October 10 to finalise the project or abandon it.

(Image: Michael Probst/AP/Press Association Images)

France and Germany hold major stakes in EADS, while the British state has a golden share in BAE that allows it to veto deals that it perceives not to be in the public interest.

Meanwhile Paris and Berlin have differing views on common EU banking surveillance, seen as crucial to ensuring financial stability.

While France would like to hand the European Central Bank power to supervise all 6,000 eurozone banks from January, Germany would like it to keep an eye just on big banks and is in little hurry, saying thoroughness trumps speed.

The past week has also been marked by shifting opinions on the necessity of a sovereign bailout for Spain, with Berlin and Madrid resisting pressure from Paris and the European Commission for a request for a full-blown aid package.

German Finance Minister Wolfgang Schaeuble insisted Friday that Spain did not need a further aid programme on top of promised loans to recapitalise its banking sector.

The drift follows significant divergences laid bare between what Germany and France see as the way forward for the currency area as a whole, going into a trio of difficult EU summits before the end of the year.

Today’s festivities were the latest in a series of events celebrating 50 years of partnership between the wartime foes, now the EU’s two biggest economies.

(Image: Michael Probst/AP/Press Association Images)