Revise border treaty - Italy, France
Rome - Italy and France have cast aside a bitter disagreement over immigration, agreeing to seek a revision of the Schengen border treaty that permits passport-free travel through Europe.
They urged increased military pressure on Muammar Gaddafi's forces and called for the creation of large Italian-French industrial groups to compete globally.
The summit on Tuesday in Rome between Italian Premier Silvio Berlusconi and French President Nicolas Sarkozy had been fraught with tension: For weeks both sides have been at odds over EU immigration rules as thousands of Tunisians entered the EU via the small Italian island of Lampedusa.
Recent French takeovers of Italian companies added to the tension: just hours before the summit began French dairy company Lactalis announced that it was making a €3.375bn bid for full control of Italian dairy giant Parmalat.
The atmosphere of Tuesday's meeting, though, was greatly improved by the news that Rome had ceded to a Nato request to augment its military activity in Libya, allowing Italian aircraft to begin strategic airstrikes on selected military targets.
The move was welcomed by Sarkozy, who said the coalition needs Italian participation.
Italy and France are the only countries, along with Qatar, that have recognised the opposition Transitional National Council as the legitimate representative of the Libyan people. A joint declaration on Tuesday said Italy and France want to allow some of the Libyan assets that have been frozen to be used for humanitarian aid and other activities in support of the population, in agreement with the rebels. They also want to put measures in place to prevent any access by Gaddafi to his country's oil resources.
Recent immigration disputes had sorely strained relations between the two traditional allies.
France harshly criticised Italy for granting temporary residency permits to some 20 000 Tunisian migrants who have arrived in Italy since the North Africa nation's dictator was overthrown in mid-January. Most Tunisians want eventually to get to France, Tunisia's former colonial ruler, where many have relatives. Italy insisted that EU countries must show solidarity and share the burden of such an exceptional influx of migrants.
'Schengen must be reformed'
France last week stopped a train carrying Tunisian immigrants from Italy at the French border, sending back those who could not support themselves financially.
Berlusconi and Sarkozy signed a joint letter to the EU to demand that the Schengen treaty take into account "exceptional" situations like the flood of Tunisian immigrants. They both appointed officials to work on the issue.
"We want Schengen to survive, but to survive Schengen must be reformed," Sarkozy told reporters after the meeting. "We believe in free circulation but we believe in a state of law and a certain number of rules."
Berlusconi said no one wanted to cancel the treaty but said "in exceptional circumstances we believe there must be variations." So far, about 26 000 Tunisians have arrived in Lampedusa, a tiny island closer to Africa than to the Italian mainland.
Curb influx of migrants
Berlusconi also said that he and Sarkozy agreed to pressure the Tunisian government to better patrol its coastline and try to curb the influx of migrants, who, Berlusconi noted, don't have a right to asylum since there is no civil war there.
Both leaders are under pressure by the far right. Sarkozy, who seeks re-elections next year, must fend off the challenge by the leader of the far right National Front party, Marine Le Pen, who wants a massive crackdown on immigration.
Berlusconi is under pressure by government ally the Northern League, a xenophobic party that was also opposed to the military intervention in Libya. News of Italy's stepped up role in the coalition angered the Northern League, and Berlusconi insisted on Tuesday that Rome would only direct "missiles of extreme precision against "individual military objectives" where "the possibility of provoking damage to the civilian population is excluded".
Italian aircraft and navy ships have been involved in refuelling and other operations for Nato's mission, and Italy has also allowed Nato use of its bases. Rome is set to host a meeting of key countries involved in the Libya campaign on May 5 in Rome to discuss increasing diplomatic and economic pressure on Gaddafi as well as providing additional support to the opposition.
'We need one another'
On the issue of French takeovers of Italian companies, Berlusconi said he didn't consider Lactalis' bid for Parmalat to be hostile and said he believed the French government was unaware of the company's plans.
"Creating large Italo-French groups is the path to follow" to remain competitive globally, Berlusconi said in comments that were echoed by Sarkozy. "There is no reason to wage war against each other ... we need one another," Sarkozy said.
Separately, Sarkozy voiced support for Italian Central Banker Mario Draghi to become the new head of the European Central Bank. He said Draghi was a top candidate who would ably demonstrate "Italy's role in the EU" and expressed appreciation for Draghi's qualities.
On Syria, both Berlusconi and Sarkozy expressed concerns over the government's crackdown on demonstrators.
"We urge them to follow through in a concrete, immediate way on their promised reforms," Berlusconi said.
Asked about possible military intervention in Syria, Sarkozy said a UN resolution would be necessary and difficult to obtain. He said the current situation was "unacceptable".