European Union leaders began a crucial summit today with hopes of an agreement on reforms of the bloc's creaking institutions hanging in the balance over demands made by Britain and Poland.
German Chancellor Angela Merkel hopes to secure an agreement at the two-day summit to launch negotiations on a new treaty to replace the EU constitution rejected by French and Dutch voters and help the enlarged 27-nation Union function more smoothly.
Chances of an accord to end years of wrangling over the division of power between Brussels and member states appeared to rise after Poland softened its opposition to proposed changes in the voting system which it says would favour bigger states.
But Warsaw has waged a fierce campaign, referring back to its suffering under Nazi German occupation, and Prime Minister Tony Blair said Britain would sign up to a treaty only if all of its four key demands were met.
"The four areas we have set down, we do need satisfied and we do need satisfied in full," Blair, at his last EU summit, said of British efforts to maintain sovereignty in foreign policy, justice, migration and human rights.
Failure to agree could prompt a smaller group of states to press ahead with closer integration, leaving others behind, and make richer countries more reluctant to aid poorer newcomers.
Blair put prospects for a deal to launch negotiations on a new treaty at only "touch and go". Polish Prime Minister Jaroslaw Kaczynski put the odds at 50-50.
European Commission President Jose Manuel Barroso was more optimistic: "The many contacts I had today confirmed to me a deal is possible -- but it will certainly be very difficult, very tough."
Merkel, chairing the talks under Germany's EU presidency, urged leaders not to obstruct a deal.
"I hope that all work in a spirit that will allow us to achieve a fair agreement because the EU needs to be effective in order for us to solve the many problems in the world together," she told reporters at a pre-summit meeting of conservatives.