Merkel warns of "historic failure" on EU charter

STRASBOURG, France, Jan 17 (Reuters) German Chancellor Angela Merkel, whose country wants to revive the European Union's stalled constitution, warned on Wednesday of the risk of a ''historic failure'' to end the stalemate on the charter.

Merkel said Germany would aim by the end of its six-month presidency of the 27-nation bloc in June to offer a plan to resolve a deadlock over a constitution which supporters say is vital to the functioning of an enlarged EU.

''It is in the interest of Europe, its member states and its citizens, to bring this process to a successful conclusion by the next European Parliament elections in early 2009,'' Merkel told the assembly in Strasbourg.

''A collapse (of that process) would be a historic failure,'' she said of efforts to break a stalemate created in 2005 when French and Dutch voters rejected the proposed charter in referendums.

Merkel has sought to play down expectations for Germany's presidency, aware that her ability to relaunch a Union in the political doldrums may hinge on factors beyond her control.

With French President Jacques Chirac and British Prime Minister Tony Blair set to leave office this year, Merkel has emerged as Europe's most influential leader.

But German officials say what she can achieve depends on who is elected French president on May 6, almost two years after French and Dutch voters stopped EU institutional reform in its tracks by rejecting the draft constitution in referendums.

Analysts and politicians said at the time the ''No'' vote, particularly in France, partly stemmed from concerns migrants from the new member states of the east would take away jobs in western Europe.

CALL TO WASHINGTON ON TRADE, CLIMATE Merkel also signalled that efforts to reconcile the EU need to guarantee its energy supplies with policies to tackle global warming would be at the heart of Germany's presidency, and issued a call to Washington to help the EU begin work on a new international accord on climate change.

''The EU needs the United States...to lay the foundations for a post-Kyoto agreement on climate change,'' she said of an envisaged new accord to apply from 2012.

The EU executive Commission last week laid out a new energy strategy, in which it announced what it said were the world's most ambitious goals for fighting climate change, targeting a cut of greenhouse gases by at least 20 percent by 2020.

Merkel reiterated her calls for closer trade and investment ties with the United States, saying Brussels and Washington should continue to cut barriers in areas such as patent rights, industry standards and in stock market access.

''A common transatlantic market is of the utmost European interest,'' she said in the speech.

EU trade officials have previously said they and US counterparts are already working on harmonising regulations to make it easier to do business across the Atlantic but creating a full free trade area would be fraught with difficulties.

Aside from difficulties with France and the Netherlands, Germany also faces an uphill struggle convincing governments elsewhere in the bloc to back its efforts on the constitution.

Britain, Poland and the Czech Republic, which promised referendums but never held them after the French and Dutch said no, have got cold feet about the treaty, diplomats say.

Behind the scenes, Germany is sounding them out on what would have to be removed from the treaty ratified by 18 member states so far to enable the remaining countries to endorse it, preferably without holding referendums, the diplomats say.

The aim is to agree in June on a timetable for producing an amended treaty with possibly some political guidelines on its content, which may entail dropping the word ''constitution''.

REUTERS MS ND1532