Blair's effort at EU prominence nixed by Chirac

British Minister Tony Blair's strategic ambition to position Britain as an equal partner with France and Germany at the heart of an expanded Europe was publicly rebuffed at the Berlin summit Wednesday night by French President Jacques Chirac.

With Blair a few feet away as the EU's "big three" grappled to generate fresh momentum for the sluggish European economy, Chirac insisted that the Franco-German relationship is "very specific" -- and not for export.

"It is not something that can be transposed or exported in the short term," Chirac said.

"It is a very intense relationship which is illustrated by regular contacts, daily contacts between government and public officials," Chirac said.

With TV cameras on him Blair took the first chance he could to say he "totally agrees about the Franco-German relationship. It is a very specific relationship."

But the three countries can and will work closely together for the common benefit of all Europe, he said.

"There should not be any sensitivity about this, any sense of exclusivity," Blair emphasized.

The summit's host, German Chancellor Gerhard Schroder, had his own gloomy message about the need for savings on welfare spending. Health and pensions costs must be "adapted to free up resources to invest in other fields", he said, after months of unrest within his own SDP ranks.

That goal was echoed by a similarly-harassed Blair when he said it was "important we make changes" -- to job creation, welfare and industrial innovation -- in order to protect living standards under the pressures of globalization.

All three leaders tried to soothe the fears of the EU "smalls", saying they were not trying to "dominate" the EU 15 -- soon to be 25 -- member states in the name of efficiency.

The trilateral summit had already been denounced by Italian Prime Minister Silvio Berlusconi as "a big mess."

"It isn't the first time we are meeting here in a threesome," Schroder pointed out Wednesday night.

As if to allay such fears they produced little by way of trilateral agreement to upset their uninvited EU colleagues who next meet at a summit in Dublin -- the last before enlargement -- next month.

The one concrete step, easily agreed between the trio, was to send a letter to the EU presidency, currently held by Ireland, to confirm that they want a restructured European Commission to include a new post of vice-president in charge of economic reform.

He or she would become a "super-commissioner" with sweeping powers across a range of portfolios, industry, trade, competition and others, which are seen as insufficiently dynamic.

The trio signed a letter on stage for the cameras. Achieving the so-called "Lisbon agenda" to create a much more flexible economy -- and overtake the US by 2010 -- has so far proved elusive.

In a bizarre intervention, Chirac revealed that, after a bilateral exchange with Schroder on Wednesday, the two leaders had agreed to reduce the value-added tax (VAT) levied on restaurant bills in the two countries to 5 percent from 2006.

"I know you are smiling, you should not smile. In France this is something people have pinned high hopes on," he told the media.

It was not immediately clear whether this special exemption is a breach of EU rules that will anger officials in Brussels.

But Germany had been opposed to the move, fearful that its border restaurants would suffer from French gastro-competition.

Blair faced border pressures. Challenged about Britain's plans to join France and Germany in imposing restrictions on jobseekers from the 10 new EU states, he refused to comment ahead of Monday's planned statement in the UK House of Commons.

Also on the agenda was the choice of successor to Romano Prodi, who is stepping down as president of the commission.