Germany retreats on EU strategic defence plans

Germany has scaled back plans for a European Union military headquarters to try to woo Tony Blair and break the deadlock over moves to boost Europe's military capabilities.

The initiative from Gerhard Schröder, the German Chancellor, will help to calm British and American fears that EU military structures would duplicate, rival and eventually undermine the Nato transatlantic alliance.

But Germany also warned of the emergence of an inner core in Europe if an expanded EU of 25 countries was unable to take decisions, and appealed for a deal next month on a draft European constitution.

Germany and France want to form an EU military planning centre, but Berlin is now willing to accept a small unit, described as a "nucleus". For serious operations, command and control would pass to national headquarters, normally in France, Britain or Germany - something London accepts.

Joschka Fischer, the German Foreign Minister, said there was no question of the EU setting up a significant military headquarters, an idea that featured at a summit in April of France, Germany, Belgium and Luxembourg. Mr Fischer said: "You have a national capability in the UK, France, Germany, Italy, Greece. I don't believe you will have another big operational headquarters."

Germany's latest thinking on defence was revealed as negotiationsover EU military structures reach a climax. After a summit in September Mr Blair accepted that a small group of countries could co- operate on defence, a plan known as "structured co- operation". France and Germany are, in exchange, likely to drop calls for a mutual defence guarantee in the EU's constitution. Britain says collective security is Nato's job.

The main dispute is over the size and scope of an EU military headquarters. Britain says it will accept a strategic planning cell (something that already exists) but not an operational headquarters.

Berlin says the EU needs a permanent nucleus for planning and command but that this would have recourse to national headquarters when operations became serious, and would co-ordinate with Nato.

Negotiations will be more intense in the run-up to a summit next month to finalise an EU constitution. Mr Fischer said the convention that drew up the draft text, of which he was a member, had produced "an excellent result", adding: "Anyone who thinks in terms of a strong EU must defend these results."

He warned that, if an enlarged EU failed to take key decisions, an inner core of member states could be formed, with France and Germany in the lead. This could arise "when we face a crisis [and] when we cannot move forwards at 25 or 28 [member states]", he said.

In such a Europe, different countries would co-operate on different issues but "some member states will be in all the cores, so this will be a core of the core", he argued. But he said this was not Germany's preference, or "a threat", adding: "The best we can do is to move forward as a Union."

In comments that will be more welcome in London, Mr Fischer stressed the importance of forging a good relationship with Washington, saying: "It is in the interests of all of us that the transatlantic relationship remains one of the cornerstones. Nobody is questioning the role of the US. If the US were to withdraw to the western hemisphere this would create enormous problems for us."

Mr Fischer also appealed to Britain to play a greater role within the EU. He said: "The enlarged Union needs a closer co-operation between France, Germany and the UK, but the decision [is one] you have to make at home."