Merkel urges harmonised policies in eurozone

(LJUBLJANA) - German Chancellor Angela Merkel called Tuesday for more coordination between eurozone members, insisting they must adopt similar policies to get to the bottom of the debt crisis.

"We have to deal with the core of the (eurozone debt crisis) problem, determine what is behind it," Merkel told a joint news conference with Slovenian Prime Minister Borut Pahor.

"Talking about it isn't enough, we have to take steps as France has done by setting itself as a goal to prepare a common taxation system for all companies.

"Further harmonisation of our policies is necessary," she said.

"The euro is not only an economic project but a political one too. We both feel committed to assure a bright future for the euro," Merkel added after her talks with Pahor.

The Slovenian prime minister meanwhile backed recent French and initiatives to safeguard the single currency, saying: "We'll do whatever is needed to meet all the Euro-plus pact requirements to improve the fiscal stability and competitiveness of our country."

Earlier this year, attempts by Pahor's government to reform the pension and labour system were blocked by the opposition and the unions.

But Merkel warned: "We all need to carry out reforms, including Slovenia."

Even if Slovenians voted "No" to these moves in referendums, "you have to find a consensus on how to implement those structural reforms," she insisted.

Merkel paid a short working visit to eurozone member Slovenia Tuesday, between meetings with officials from Portugal and France in Berlin to discuss the eurozone debt crisis as well as European prospects for the Balkans, following recent clashes between Kosovo and Serbia.

"There will be no good co-habitation in Europe as long as we do not solve these conflicts," she urged, after Belgrade deemed the conditions she set last week for its EU candidacy as "unacceptable."

"In that sense every side will have to make a step."

Merkel was also scheduled Tuesday to meet Slovenian President Danilo Turk and the head of the main opposition centre-right Slovenian Democratic Party (SDS), former prime minister Janez Jansa.