Merkel plots EU army with Emmanuel Macron as she vows to create a United States of Europe

The German Chancellor is on the ropes at home as she desperately tries to seal a coalition deal with the SPD after her election debacle last year.

But she insisted today there was no major difference between Mr Macron’s vision of a more tightly-bound EU and her own coalition blueprint for reform.

Angela Merkel told a news conference: “Germany and France can and should take the lead on many questions and therefore I understand that France is waiting that we have a new government.

“On a broad basis, there is absolutely no difference that I see. 

“It is a Europe that must have a common foreign policy on strategic questions, a Europe that must create its own development policies, a Europe of defence, and it is a Europe that has to be economically strong.”

She predicted France and Germany, the financial powerhouse of the EU, could make rapid progress on issues like common corporate tax structure and a banking union for the euro zone.

And she said the European project needed to take its lead from the US with a more federalist approach.

The Chancellor said: “There are areas where France and Germany can take the lead, for example by creating a common corporate tax structure.

“When I see what the United States is doing, time is pressing for such a project. 

“We also want a stable euro zone and strong external border protection.

“The euro zone must be avantgarde when it comes to competitiveness.”

Mrs Merkel is in Paris for an evening of talks with Mr Macron, after the two agreed at a European Union summit last month to draw up joint plans for the euro area by March.

The French President, fresh from his trip to the UK, has talked in the past about the need for a standalone budget and a single finance minister for the currency bloc.

But he played down any technical discussions on Friday, saying the priority was to agree on the end-goal first.

He said: ”If you begin by discussing the instruments without knowing what you want to do with them, there’s little chance of success.

“That’s not how we in France have historically drawn up our budgets.

“We still have to define the details.

”That will be the subject of our discussions today and in the weeks and months to come, to define a path that will take us in that direction.”

Without agreement between the two leaders, whose nations account for 50 percent of euro zone output, any ambition to upgrade Europe’s economic and monetary union is unlikely to get off the ground.

This year is seen as a critical but narrow window, with the European Parliament holding elections and Britain leaving the bloc in 2019.

Brexit is seen as an opportunity by those who favour an ever-closer union because it removes a key critic of Brussels from the bloc.

European Commission President Jean-Claude Juncker used his state of the union address last year to call for a United States of Europe.

His vision has been backed by key EU figures like Guy Verhofstadt.