HIGHLIGHTS - Sarkozy, Merkel at Franco-German summit

PARIS Feb 4 (Reuters) - French President Nicolas Sarkozy and German Chancellor Angela Merkel met on Thursday in an atmosphere of growing tension over euro zone budget stability and the future of the troubled A400M military transport project.

Here are comments from a joint press conference.

FROM THE JOINT DECLARATION

PUBLIC FINANCES

"(France and Germany) confirm their commitment to sustainable state finances within the stability and growth pact and (they) point out that the current excessive deficit situation should be ended by 2013: balanced budgets should be within reach by the middle of the decade."

GAS CLEARING HOUSE

"We are going to study the possibility of setting up a German-French gas clearing house that involves all players. It should ensure that German and French clients will be supplied as sufficiently as possible through suitable cross border mechanisms in the case of gas shortages."

NICOLAS SARKOZY QUOTES

JOINT FRANCO-GERMAN POSITIONS

"We will present common proposals on issues that are important to us. Economic governance for the 27 (EU states) is something where we are very much in agreement; the lessons to learn from the Copenhagen (climate summit); the preparations for the French presidency of the G8 and G20 which we will manage together facing up to the essential questions as far as we are concerned like the reform of the international monetary system, where there will be a Franco-German proposal."

"We (also) think ... that we need to review the indicators for economic growth if we want to see sustainable growth."

"We are also going to address the big international questions and take common initiatives on the Middle East.. and the partnership between Europe and Russia, where want to highlight and follow up on the propositions made by (Russian President) Medvedev."

"We are affirming an extremely important political choice here, the will to make a success of the new global governance."

FRANCO-GERMAN LEADERSHIP

"We need to create this Franco-German leadership, the regulation of capitalism and the transition for the institutions of the 20th century with the institutions of the 21st century. This is not against anyone, and it does not translate into any desire to be arrogant or to dominate or give lessons to anyone. Rather, we want a Europe that exists strongly in the political domain and for Europe to exist strongly, Germany and France have to work together."

U.S. PRESIDENT OBAMA NOT ATTENDING EU-US SUMMIT

"Regarding the U.S., I don't even understand the controversy. What does it matter if the European-U.S. summit takes place in November rather than May? Where is the drama? Is that really a problem in the world these days? Is it more important than unemployment? Than the financial crisis? ... You want to know what I think? There are too many summits. There is too much moving around. There is too much time wasted."

A400M

"Everything must be done to reach a solution. It is a decisive project which must be resolved very quickly,"

ANGELA MERKEL QUOTES

A400M

"With regards to the A400M project, I think that the negotiations should be continued, and we agreed that this is a project of strategic significance, and that everything should be done to find a solution."

NEW ECONOMIC GROWTH INDICATORS

"It is particularly important for me that we agreed to work on the question of what growth and prosperity mean in the 21st century in terms of sustainability for highly developed industrial nations.

"The wise men will sit together and will put together a report by the end of the year, which will look at how we can create new indicators and what we can do on an European level to modernise our growth strategy in the sense of fostering a sustainable and responsible economy."

MERKEL ON ECONOMIC GROWTH

"We will bring suggestions, joint suggestions into the discussion when the European Council meets on Feb. 11 and look at the question of economic strategies for the future. For me it's important that Europe is truly honest about the discussion on how we'll shape growth in the future. That we'll put the facts on the table: where are we good and where are we bad?

"In the past we promised some things that we weren't able to achieve. And often we weren't very honest about who didn't deliver what."

(Reporting by James Mackenzie, Sophie Hardach, Anna Willard, Sophie Taylor, Crispian Balmer, Madeline Chambers and Erik Kirschbaum)