Merkel, Sarkozy in first joint Armistice ceremony

While the leaders paid homage to the war dead, much of the talk was about the future, from policy to conflict resolution.

"The Germans and the French, once bitter enemies, now stand united as neighbours in a way that nourishes hope and confidence that elsewhere in the world, too, deep trenches can be bridged and overcome," Merkel said in her speech.

France and Germany are probably the closest allies in Europe, having long acted as the main driving force of the European Union. They run a joint military battalion, propose joint candidates for top EU posts, and there has been talk of turning Armistice Day into a festival of Franco-German friendship.

While there have been spats over France's fiscal laxness and ways of tackling the economic crisis, the two vowed on Wednesday to tightly coordinate policies in an enlarged EU.

"We share the same values, the same ambition for Europe, the same currency," Sarkozy said. "So it is natural that French and German policy should be conducted more and more closely."

(Editing by Mark Trevelyan)