prices ( hicp ), which is the measure of inflation in the euro area, france is one of the three best - performing countries in terms of inflation : french inflation stood at 0. 7 % as an annual average in 1998, compared with 1. 1 % for the euro area. in the course of 1998, the franc remained constantly above its central rates vis - a - vis the other most credible currencies of the european exchange rate mechanism. the goal of a stable external value for the franc — which was the external intermediate objective of french monetary policy over the last five years — was thus achieved. this went hand in hand with the maintenance of the competitiveness of the french economy. the current account surplus totalled frf 236 billion in 1998, or 2. 8 % of gdp, comparable to the level recorded in 1997. with regard to monetary and financial developments, and particularly growth in monetary aggregates — which constitutes the internal intermediate objective of french monetary policy —, the means of payment covered by m1 posted a year - on - year rise of 3. 1 % in december 1998, after 6. 5 % in december 1997. sight deposits paying regulated rates of interest included in m2 – m1 showed a yearon - year increase of 5. 7 % in december 1998, sharply down on the 9. 2 % recorded at the end of the previous year. similarly, m2 progressed by 4. 3 %, less than the 7. 8 % rise recorded in 1997. the aggregate m3 – m2, which covers liquid investments paying market rates of interest, stabilized in 1998 with a 0. 6 % decline after the 8. 2 % drop recorded in 1997. this was mainly due to growth in money market ucits, which rose by 4. 1 % after declining by 11. 3 % the previous year. the year - on - year increase in m3 was 2. 7 %, compared with 2. 0 % in december 1997. growth in investment in contractual savings products recorded in the p1 investment aggregate maintained a sustained pace in 1998, and in all m3 + p1 showed a year - on - year progression of 4. 0 %, against 5. 1 % in december 1997. total domestic debt posted a year - on - year rise of 3. 4 % at the end of december. it had shown an increase of 3. 7 % in december 1997. financing raised on the domestic markets progressed vigorously, with the year - on - year advance standing at 9. 2 %

if we wish to retain our clout in future trade negotiations at the global level. third asset : our common social model in europe. it is less widely discussed, but it is what fundamentally defines continental europe, and it is what german and french society and public opinion share. our social model combines a high level of public service, relatively low levels of inequality – much lower than in the united states – and a good intensity of social dialogue. and this has been achieved in a market economy. i would like to stress the extent to which this social market economy ( soziale marktwirtschaft ) is a response to the questions raised in the anglosaxon world, rather than protectionism : germany, like many other european countries, proves that economic success can go hand in hand with social welfare, and less inequality. we can be proud of these three assets that we have built together. but for the future, while some no longer seem to believe in the benefits of the european project, we can no longer afford to be complacent ; we cannot simply rest on our laurels. ii. in order to control our common destiny we need to build a better europe. how should we react? not by less europe. this would be a mistake if we want to take collective control of our destiny in this new world. but by a “ better ” europe, less caught up in the detail, more focused on a few key priorities, and more efficient. to achieve this, europe needs the energy of germany and france, and of their remarkable friendship. i will now cite chancellor helmut kohl : “ the germans and french must together build the hard core of the european union – a union that sees itself not merely as a common market, but as a community of values, a democracy based on freedom, the rule of law and the social responsibility of the state ”. 3 naturally i won ’ t talk to you this evening about the french election debate : i will simply say that as friends of france, you must not underestimate the strength of its institutions. i will talk to you even less about the german election debate. but i strongly believe that after these democratic elections, whatever the outcome, the governments of our two countries will have to confer to decide on a number of shared bilateral projects, and above all prepare a common initiative for europe. because for germany and for france, the other country is certainly the best possible partner : there is no serious alternative, neither in the east