Crisis Talks to Assess EU Charter Wreckage

Despite the resounding blow dealt to the document by the two EU founder members, the German chancellor is eager to see the ratification process to continue in the remaining countries of the 25-nation bloc.

Thus, it's unlikely Gerhard Schröder will waste much time consoling his close friend Jacques Chirac for the failed referendum in France.

The German chancellor is in a defiant mood now that Dutch and French voters have rejected the new EU charter and plunged the European Union into severe crisis. One day ahead of his meeting with Jacques Chirac in Berlin, Schröder vowed to press ahead towards the goal of a fully-fledged constitution.

"I will not accept attempts to stop the entire project simply because two countries rejected it," he said. "Germany has adopted the constitution as well as a number of other countries. Only at the end of the ratification process will we be able to decide what to do next. That is why any form of overreaction is totally misplaced."

A tricky situation

Yet the two leaders are in a dilemma. Stopping the ratification process is apparently unacceptable to the German chancellor. A renegotiation of the treaty or new votes in the countries opposed to it has also been widely ruled out.

What may come under discussion during the crisis talks are ways to extract key provisions in the treaty such as streamlining the EU voting system and establishing the post of an EU foreign minister so that are not subject to

referendums.

Another possibility would be to continue with the ratification process and assess the situation at the end of it in 2006. Berlin appears to be placing some hope on a much-underrated annex to the constitution treaty which allows for an EU summit meeting to discuss further steps if at least 20 of the 25 EU members have ratified the charter.

German Foreign minister Joschka Fischer also believes that the constitution treaty is not dead as yet.

"I don’t think that there is a better treaty to be found anywhere," Fischer said. "So we have to work hard to rescue it. Obviously we have to put some of our foreign policy objectives on hold for the time being, because of the EU’s internal problems, but the world won't just stand by and wait for us. "

Dipping popularity at home

As Chirac and Schröder form a common, pro-constitution front when they sit down to their working dinner in Berlin, they might also reflect that they share something else -- plummeting popularity ratings at home.

Schröder's Social Democrats suffered a devastating defeat in a state election last month, prompting him to call for a general election this September, 12 months ahead of schedule. Opinion polls show he will lose to the conservative opposition Christian Democrats of Angela Merkel (photo).

Chirac meanwhile suffered the humiliation of seeing his people ignore his appeals for them to ratify the constitution and spent the week looking, to many analysts, like a lame duck president.

The "no" vote forced him into a government reshuffle, promoting former health minister Philippe Douste-Blazy to foreign minister. Douste-Blazy was candid about the future, saying: "We are obviously in a difficult situation after two negative referendums."

Chirac's spokesman meanwhile said he would use the Brussels summit to assure his EU colleagues of France's commitment to the bloc and its "anchoring within the Union" in the coming weeks.

Schröder's new flexibility

In an attempt to pour oil into troubled waters, Gerhard Schröder has already signaled flexibility in an ongoing row over EU financing which has pitted net contributors to the budget against recipients. Although no details were given by the chancellor, a deal could include a rise in German EU contributions beyond the current 1 percent of gross national product.

Schröder’s new flexibility could perhaps include concessions towards Britain which enjoys a rebate from EU coffers that most members want scrapped. It wouldn’t be the first time that Germany has sought to buy Europe out of its troubles and it’s a prospect that could even keep prime minister Tony Blair from canceling the British referendum and declaring the constitution dead once and for all.

Blair will meet Schröder in Berlin on June 13.