The French President Nicolas Sarkozy has said, he will meet the German Chancellor, Angela Merkel in Paris on Monday to announce a joint plan to safeguard the future of Europe.

In a major speech, he said, France and Germany will seek a new European Union Treaty to impose greater integration and financial discipline on European Governments. Despite recent disagreement with Angela Merkel over the role of the European Central Bank, Mr. Sarkozy said, Germany and France agreed that there should be a new Treaty to impose greater integration and discipline on government finances.

Following the announcement, the interest rates on Government debts of some of the countries at the heart of the EURO crisis fell sharply. The relief in the Bond market reflects the hope that next week's European summit will take decisive step to resolve the crisis.