France's Socialist candidate for president, Royal said she agreed with Merkel that Europe needed to increase industrial cooperation.

"Europe has to do everything possible to define a shared industrial policy," she said after a meeting with Merkel on Tuesday. She was in Berlin for one day to present her presidency plans should she win the spring election and become France's first female president.

Airbus key point in talks

Proposed job cuts at Airbus have been a recent sticking point in Franco-German relations, as more than 10,000 employees took to the streets in Toulouse, the company's French headquarters, on Tuesday to protest the plans that could see some 4,300 jobs in France slashed and another 3,700 cut in Germany. The company said it hopes the rescue plan will save five billion euros ($6.6 billion) in costs over the next three years.

Royal said she and Merkel were able to agree on the importance of protecting the European airline giant and that priority had to be given to the job concerns of employees as well as to efforts by management to ensure the company remains financially stable and productive.

"We completely share the aim that Europe must defend its aeronautical venture," Royal said.

Merkel added that it was important for governments "to understand the industrial challenges without intervening in the company's economic direction" and said maintaining research facilities, particularly in the aviation sector, needed to play an important role in European policy.

Royal marks French environmental shift

The chancellor also received the French candidate's backing on increasing the EU's use of renewable energies. Merkel wants 20 percent of the 27-member bloc's energy to come from renewable sources by 2020, a target Royal supported.

"Germany is right to make this suggestion that the current administration in Paris unfortunately does not support," Royal said.

Current French President Jacques Chirac's government, however, is not alone in opposing Merkel's climate goals as half of the bloc's foreign ministers Monday said they were against setting mandatory limits on carbon dioxide emissions.

The climate plan is on the agenda for a two-day summit of EU leaders beginning Thursday in Brussels.

Royal faces conservative Interior Minister Nicolas Sarkozy in the May election to succeed President Jacques Chirac. Merkel discussed potential presidential plans with Sarkozy on Feb. 12.

Restarting the EU's motor

If elected Royal said she wanted to restore "the lost initiative" of the French-German relationship. The two countries are often referred to as the "motor" of the European Union.

Germany has made reviving the European constitution one of the priorities of its current presidency of the EU despite its rejection by French and Dutch voters.

Royal proposed this week that the text should be rewritten, renamed a treaty rather than a constitution and put to a referendum before European elections in 2009.

Without mentioning the constitution by name, Royal said she and Merkel "have the same point of view on relaunching the European project."