Blair, Schröder and Chirac to set new course for EU

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The leaders of Britain, France and Germany will stage a highly symbolic summit this weekend to try to reach agreement on a new direction for the European Union and finally bury their bitter differences over Iraq.

Tony Blair will join Gerhard Schröder, the German Chancellor, and Jacques Chirac, the French President, in Berlin for what could be the first regular meeting of the "gang of three", aimed at setting the EU's agenda.

France and Germany, traditionally seen as the "engine" driving the EU, already hold regular summits. Mr Blair's inclusion is seen by his officials as a sign that Britain can play a pivotal role in the negotiations on a new EU treaty, which begin on 4 October - even though a euro referendum in Britain now looks at least three or four years away.

Saturday's gathering was mooted when the leaders met informally at an EU summit in Greece in June and was then agreed in July. Downing Street denied it was a crisis meeting to discuss a new United Nations resolution on Iraq, but the leaders will attempt to break the deadlock on the issue.

The Iraq war soured Britain's relations with France and Germany. But Saturday's event is the clearest signal yet that Paris and Berlin are ready to "move on".

The UK, France and Germany are members of the UN Security Council and France is now backing away from threats to veto a new resolution that would pave the way for troops from other nations to join the peace-keeping effort in Iraq. Paris wants political control of Iraq to be transferred to the UN, although it has suggested that this might be "symbolic", rather than real.

Mr Blair will come under pressure to ensure the UN gets a bigger role in Iraq than the US has proposed, and a more speedy transfer of power to the Iraqi people.

Last night, British officials said the three EU countries shared the objective of seeing a democratic, prosperous Iraq. The German government said the meeting would help "to agree common positions in foreign policy after there were divergent opinions in the run-up to the Iraq war".

The discussions will also include the economic situation and Sweden's "no" vote in its euro referendum. A priority will be to find common ground before the Inter Governmental Conference, which will try to agree a new EU constitution by the end of the year.

The event will be watched closely by the EU's smaller countries for any sign that the "big three" are striking a deal behind their backs. In an apparent effort to soften the blow, Mr Blair has invited his Spanish counterpart, José María Aznar, to talks at his Chequers country residence on Sunday.

But there was surprise yesterday that Italy's Prime Minister, Silvio Berlusconi, has been excluded from the Berlin summit, particularly as Italy holds the EU's rotating presidency.

Diplomats said it was "too early to say" if the summit would develop into regular meetings. "This is an open process, so what comes from there remains to be seen," one said.