Politicians like to portray Franco-German economic cooperation as some sort of marriage made in heaven, both anchor and driving force behind wider European integration, indeed the very cornerstone of Europe as an economic power.

But relations between Berlin and Paris appeared to have entered a distinctly rocky patch this week as nationalistic frictions resurfaced over the balance of power within EADS, huge losses were recorded and a class action suit was launched. Also, no progress was made in the long-running courtship of stock exchange operator Euronext by its German counterpart, Deutsche Börse.

Superjumbo woes

The French government this weekend let it be known it wants to find a solution by Tuesday to the crisis at EADS, European Aeronautic Defence and Space Company. It revolves around a co-chief executive of the aerospace group and the manufacturing delays to the Airbus A380 superjumbo jet.

French Finance Minister Thierry Breton "is determined to find a solution to the EADS problem within 72 hours," said a ministry spokesman. "This is a decisive weekend for the future of the group."

The turbulence started at EADS when its aircraft unit, Toulouse-based Airbus, announced June 13 there would be delays in delivering the new A380, the world's biggest commercial aircraft.

That news, coupled with a profit warning, sparked huge losses in EADS shares the following day, when the group saw more than a quarter of its market value disappear.

Media speculation suggested this week that Noel Forgeard, EADS' French co-chief executive, might be forced out over his decision to sell large numbers of shares in the company about a month before the superjumbo problems were revealed, leaving German Thomas Enders in sole charge. At present, EADS has an uneasy dual management structure, with the position of chief executive shared by Enders and Forgeard.

Forgeard has insisted he was unaware of the difficulties at Airbus when the sales were made and has said he acted with no "privileged information."

Class action suit

But France's Association of Active Shareholders (AAA) said on Sunday it was launching a class action lawsuit against EADS, claiming damages for its market value collapse.

"EADS shareholders were duped", AAA's president said. The
association reckons shareholders have lost 10 billion euros ($12.5 billion dollars)

National egos

With precious national egos at stake, however, the balance of power within EADS is extremely delicate. Not surprisingly, nationalistic tensions within EADS have resurfaced on a regular basis, with each side accusing the other of trying to wrest sole control of the group.

Germany is represented by German-US auto giant DaimlerChrysler, which has the same size stake as the French state and the French Lagardere group. And this is reflected in the uneasy dual management structure, with the position of chief executive shared by Thomas Enders, a German, and Frenchman, Noel Forgeard.

French Premier Dominique de Villepin is too wily not to have known that his demand, in front of the National Assembly in Paris on Tuesday, for a "total rethink" of EADS's shareholder structure would raise hackles in Berlin.

It only served to confirm the traditional German bugbear that French economic policy is deeply interventionist and that Paris ultimately wants to hijack the driving seat at EADS for itself.

Germany, which likes to portray itself as more hands-off in matters of corporate strategy, was quick to call de Villepin to order. With EADS "currently in a phase that is anything but easy, economically speaking, any debate over the Franco-German shareholder pact comes at the worst possible time," said CDU politician and the head of the German parliamentary committee for EU affairs, Matthias Wissmann, with gritted teeth.

On Friday, German Economy Minister Michael Glos also called for a rapid solution to the EADS crisis, but he insisted it was "primarily a matter for industry to get things in order" and it would make no sense for the government to intervene.

Stock market scrap

The same tensions have also been spotlighted in recent weeks in the long-running attempt by Frankfurt stock exchange to woo its pan-European rival Euronext, which operates the Paris, Amsterdam, Brussels and Lisbon exchanges.

In the much-needed process of consolidation of Europe's stock exchanges, nothing would seem more logical than a merger of the two in order to create a truly European champion, capable of taking on the mighty New York Stock Exchange or the venerable London Stock Exchange, which recently tied the knot with the US Nasdaq electronics exchange.

But fearful of becoming a mere appendage to Frankfurt, Euronext's management, headed by Frenchman Jean-Francois Theodore, has repeatedly snubbed Deutsche Börse's advances in favor of being taken over by the NYSE.

Unlike with EADS, however, German and French politicians actually seem to be pulling in the same direction in the case of Deutsche Börse and Euronext, with both French President Jacques Chirac and German Chancellor Angela Merkel openly favoring a European rather than a transatlantic solution.