This weekend's inconclusive summit meeting in Vienna has left Germany's six-month EU Presidency, which begins on January 1st, with a formidable legacy of unfinished business. The Chancellor, Mr Gerhard Schroder, faces the task of pushing through the controversial Agenda 2000 reform package by the end of March and agreeing a European pact to combat unemployment three months later.
Mr Schroder repeated in Vienna his call to end unfair tax competition but admitted that no movement on the issue was likely during Germany's EU presidency.
"We'll have to wait until Helsinki (in December) for substantial results in this area. If we manage to get Agenda 2000 off the ground, that will be a big enough achievement. It will certainly be difficult enough," he said.
Germany is determined to reduce its net contribution to the EU budget as part of the Agenda 2000 reform package, which also covers such issues as agricultural policy and Britain's rebate on its budget contribution. The EU leaders hope to agree the package at a special summit in Brussels on March 26th next year.
Predicting that it would be "the summit to end all summits", a German official identified Spain as the biggest obstacle in the way of a cut in Bonn's budget contribution.
"There'll be fireworks and there may be a few nastier explosions. We have no intention of rolling over in front of the Spanish," he said.
Mr Schroder, who will spend a Christmas holiday in Spain later this month, expressed the hope that a compromise could be found and called for as little publicity during the negotiations as possible.
"It is right that the strong should show solidarity towards the weak. But solidarity must not be misunderstood as a one-way street," he said.
The new German government made a point of flexing its muscle at Vienna, with the Foreign Minister, Mr Joshka Fischer, warning that Germany could no longer be the "milch cow" of Europe. Mr Schroder admits that a reduction in Germany's contribution will not amount to "winning the lottery" but he is confident that he can effect a long-term change.
"I think that, over a longer period, we'll be able to ensure that the curve of German contributions no longer rises but falls," he said.
Domestic pressure to cut Germany's budget contribution is immense but Mr Schroder's room for manoeuvre in the Agenda 2000 negotiations is limited. He insists the EU cannot accept any more members until it reorganises the way it is funded and German officials now suggest the first new members from central and eastern Europe will not join until 2006.
Unlike the conservative government of Dr Helmut Kohl, which depended on farmers' votes, the present German coalition favours big changes in how farming is subsidised. Mr Schroder favours a system of "co-financing" agricultural subsidies, with Brussels sharing the burden with national governments.
German officials concede that EU leaders may need to hold a mini-summit in Bonn at the end of February before they meet to thrash out the final details of Agenda 2000 a month later. But many observers predict that, even in late March, the differences will be too great to overcome.
If Agenda 2000 will dominate the first months of the German presidency, the final months will be devoted to the launch of a European employment pact to take some of the EU's 18 million unemployed off the dole. The fight against unemployment is at the heart of Mr Schroder's government programme in Germany but the attempt to introduce EU-wide measures is likely to expose deep ideological differences within Europe.
Germany and France, along with most of the EU's socialist-led governments, want to cut unemployment by co-ordinating economic and tax policies to promote economic growth. But a number of EU states, including Ireland and Britain, believe the best way to create jobs is to cut taxes and make labour more flexible.
Mr Schroder faces a tough test of his negotiating skills over the coming months as he attempts to promote Germany's national interests without jeopardising the chances of finding agreement among the EU's 15 squabbling-member states.
"I think I've been able to make it clear that, if there is no agreement, everyone loses. And that also makes others reflect on what they could lose," he said.