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Changing of guard could be positive step

WE witnessed a changing of the guard in Paris yesterday -- certainly for France and also for Europe.

New French President Francois Hollande took over and after the rain-drenched ceremonies were dispensed with he took on his first undoubtedly tone-setting meeting with German Chancellor Angela Merkel.

Ostensibly the pair view the crisis from the political equivalents of the north and south poles. Mr Hollande wants money pumped into economies to encourage growth. Ms Merkel wants to keep the purse strings tightly drawn.

Both are at a crossroads with latest figures showing the French economy stalling and only German expansion keeping the eurozone out of recession.

Mr Hollande's role in Europe will define his presidency, as his almost immediate departure for Berlin yesterday attests. But it will also redefine relations between the EU's biggest pillars.

There is reason for concern. Jittery markets require little encouragement to get even more nervous if they sense conflict at the highest level. But there is also reason for hope.

While the relationship could easily be seen as a clash of fundamental opposites -- the centre-right German chancellor's unwavering fiscal rectitude pitted against Mr Hollande's left-leaning desire to prioritise growth -- the divergence between them is not so great. It may suit both to present themselves that way to their domestic audiences but they are ultimately hard-headed politicians who have to deal with the reality of an appalling crisis.

For example, Ms Merkel favours structural reform but Mr Hollande prefers infrastructure investment financed by EU "project bonds".

In real life there is little doubt that both positions can be accommodated within the existing fiscal treaty without much difficulty. The German chancellor might even be grateful for a new European partner able to provide vital political cover for a shift it would be unwise, and impractical, for her to lead herself.

For all his brave words, Mr Hollande is far from radical even when it comes to his domestic concerns.

The mood music in France and Germany may be of a different tempo, therefore, but the song is largely the same. Just as importantly, the personal chemistry of the partnership at the heart of the eurozone may now work better than it did. They may come from different sides of the political spectrum, but Ms Merkel will likely have more in common with Mr Hollande's sober, consensus-building and old-style European leanings than ever she had with Mr Sarkozy's tempestuous flamboyance and outspoken Atlanticism.

The Socialist victory in France, taken with with recent wins for the German left in two regional elections, merely adds to the growing sense that some sort of change is imminent. Even a slight shift in emphasis could have major beneficial ramifications for us all.

Next week's meeting of EU leaders, ahead of the key summit in June, could be a big stepping stone along the road to some sort of stimulus package. Mr Hollande's election may have nudged expectancy of a more positive and constructive outcome a little higher. That, in itself, would make the changing of the guard a step in the right direction.

Irish Independent