EU leaders unite for war memorial before Juncker battle

YPRES Belgium/BRUSSELS Thu Jun 26, 2014 11:02am EDT

YPRES Belgium/BRUSSELS (Reuters) - European Union leaders gathered in Belgium for a solemn ceremony on Thursday to commemorate the 100th anniversary of World War One, determined to display unity despite deep disagreement over who should head their most influential institution.

At Mending Gate, a memorial to 50,000 British and Commonwealth soldiers killed in the battle of Yore's, German Chancellor Angela Merkel was due to stand alongside British Prime Minister David Cameron, French President Francois Hollande and other leaders to honor the fallen of what became known as the Great War.

Merkel, Cameron and Hollande were expected to join hands as a trumpeter sounds the Last Post, in a symbol of reconciliation among former enemy nations that barely masks Cameron's isolation among his fellow leaders.

The haunting music has been played daily at the Gate since 1928, with the exception of the World War Two years of Nazi German occupation.

"This shows us what good times we are living in today thanks to the existence of the European Union and how we have learned the lessons of history," Merkel told reporters on arrival in nearby Kortrijk for a prior meeting of center-right leaders.

EU officials were at pains to ensure the ceremony was not overtaken by a fierce political battle over the leadership of the European Commission, a decision due to be taken when the summit moves to Brussels on Friday.

But the smouldering row over whether former Luxembourg prime minister Jean-Claude Juncker should lead the EU's executive for the next five years hung over Thursday's events, even if it was kept off the dinner table at which leaders were due to debate a 'strategic agenda' for the 28-nation bloc.

Merkel voiced determination to go ahead with the nomination once leaders have agreed on policy priorities to promote growth, consolidate budgets, create jobs and fight youth unemployment.

Cameron adamantly opposes Juncker, arguing that the veteran of EU summits is not the right person to drive reform of the Commission and that his appointment would amount to a power grab by the European Parliament, which has demanded his nomination.

FORCED VOTE

The British leader is determined to force an unprecedented vote on Juncker's nomination to underline his dissent if, as expected, the others decide to press ahead with the appointment.

Asked whether he was willing to outvote Britain, French President Francois Hollande told reporters: "If there is a request for a vote, I am in favor of voting. There comes a time when Europe needs to say what we want in terms of people and policies."

A vote looks inevitable, and is expected to go 26-2 against Cameron, with only Hungarian Prime Minister Viktor Orban siding with him.

That would highlight Britain's isolation and add to concerns that the country is moving inexorably closer to leaving the EU after 41 years of often uneasy, semi-detached membership.

But Britain's friends in the EU said they would work hard to make sure it remained a member despite the rift over Juncker.

"We’re all now responsible for whether the United Kingdom can stay inside the European Union," said Swedish Prime Minister Fredrik Reinfeldt, who initially sided with Cameron but backed down when it became clear Juncker had the numbers. "I'll do whatever I can for Britain to stay inside the European Union."

The UK Independence Party, which advocates withdrawal from the bloc, won most seats in European elections in Britain last month, pushing Cameron's Conservatives into third place.

British officials acknowledged Cameron faces defeat but said he was determined to take a stand of principle against the parliament effectively imposing a candidate on national leaders.

Juncker, 59, was the leading candidate of the center-right European People's Party which topped last month's poll, in which each of the mainstream political families fielded a so-called "Spitzenkandidat" for the Commission presidency.

Opinion polls show the British public support Cameron's refusal to compromise and believe he is showing strength by standing up to Europe, despite his isolation.

However, Friday's expected clash is bound to leave a bitter taste, complicating Britain's relations with the next Commission chief at a time when Cameron has promised to renegotiate its relationship with the EU before holding an in/out referendum on British membership in 2017, provided he is re-elected next year.

"Cameron has lost a lot of goodwill with this behavior, even among leaders like Merkel who want to help him keep the UK in Europe," a senior EU diplomat said.

"The EU is built on compromise and it's hard to help someone who refuses to compromise," he said.

OLIVE BRANCHES SPURNED

European Council President Herman Van Rompuy, who will chair the summit, had offered Britain olive branches on the policy agenda and a major economic portfolio in the next Commission but Cameron spurned his offers.

Van Rompuy has suggested leaders meet again on July 17 to make other key appointments, including the choice of his own successor and of the EU's foreign policy chief and economics czar. That would allow for a cooling off period after the row with Britain.

Danish Prime Minister Helle Thorning-Schmidt, insisting she was not a candidate for any of the top European jobs despite widespread talk of her succeeding Van Rompuy, told reporters: "We still hope that the UK will be on board on this kind of decision. We believe the UK needs the European Union, but also that the EU needs the UK."

Southern European countries led by Italian Prime Minister Matteo Renzi are set to obtain a softening of the way EU budget rules are implemented, which Merkel accepted this week as the price of their support for Juncker, her party's candidate.

"If we care about Europe, we must step up our efforts on growth and employment," Renzi told reporters.

Draft summit conclusions seen by Reuters showed the leaders will agree on Friday to apply the EU rules as flexibly as possible to support growth, taking structural reforms into account when assessing deficits.

The leaders will also sign a crucial association agreement with Ukraine on Friday despite Russia's attempt to deter Kiev from moving closer to the EU, as well as with the former Soviet republics of Georgia and Moldova.

They will discuss whether to step up targeted sanctions against Moscow over what the West says is its efforts to destabilize Ukraine by covertly supporting separatists in the Russian-speaking east of the country after seizing and annexing the Crimean peninsula in March.

(Additional reporting by Jan Strupczewski in Kortrijk, Belgium and Giselda Vagnoni and Francesco Guarascio in Elverdinge, Belgium; Writing by Luke Baker and Paul Taylor; Editing by Jeremy Gaunt)

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