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EUROPEAN LEADERS DISCUSS SINGLE CURRENCY, CLOSER UNITY

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After two days of wrangling over the future of their region, European Union leaders stumbled ahead with plans for a single currency and closer union despite lingering doubts.

The informal summit was billed as a forum for leaders to exchange ideas on the Maastricht Treaty, which lays the foundation for closer political, economic and possibly military cooperation.But the meeting at a secluded hotel on the Spanish island of Majorca seemed clouded from the start by a German-initiated spat over whether Italy will qualify to participate in a single EU currency.

On Friday, German Chancellor Helmut Kohl apologized to Italy for remarks by his finance minister, Theo Waigel, that Italy will not likely be able to join the first group of countries using a single EU currency in 1999.

The comment was interpreted as a slap at Italy.

"Germany does not want to exclude anyone," Kohl told a news conference, where he was joined by Italian Prime Minister Lamberto Dini.

He said Waigel spoke out of turn this week when he suggested Italy would not meet the economic criteria to join the as-yet-unnamed EU currency.

The 1991 Maastricht Treaty opens the door for a common European foreign and security policy and a single European currency. The treaty is scheduled for review next year.

Under the monetary union plan, EU nations wanting to adopt the single currency must have low inflation, narrow budget deficits and reduced public debt.

British Prime Minister John Major is among the Eurocurrency skeptics. He said he didn't believe the union would be ready for a single currency by 1999, not even a limited number of EU members. It will be even more difficult after the EU expands, he said.

No one has given serious thought as to how the union will be affected if half a dozen nations move forward with a single currency in an alliance of 25 or 30 members, he said.