Merkel Calls for 'Strong UK with Strong Voice inside EU'

German Chancellor Angela Merkel on Thursday urged Britain to stay in the European Union, saying the bloc would be a stronger force in the world with London's voice.

But Merkel, in a speech to the British parliament, played down Prime Minister David Cameron's hopes of reforms to the EU before a referendum on Britain's membership in 2017.

Addressing lawmakers in English and German, Merkel said a united EU could be a "model for other regions of the world. This and nothing less than this should be our common goal".

She added: "In order to maintain this goal we need a strong United Kingdom with a strong voice inside the European Union. If we have that we will be able to make the necessary change for the benefit of us all."

Merkel is due to discuss EU reform with Cameron during a lunch meeting at the prime minister's Downing Street residence, before having tea with Queen Elizabeth II.

The chancellor said she was aware there were high expectations from her speech to members of the House of Commons and House of the Lords, the first by a German leader since president Richard von Weizsaecker's address in 1986.

But she said she was "caught between the devil and the deep blue sea" in terms of what she could offer.

"I have heard some expect my speech to pave the way for a fundamental reform of European architecture which will satisfy all kinds of alleged or actual British wishes. I am afraid they are in for a disappointment," Merkel said.

"I have also heard that others are expecting the exact opposite and are hoping that I will deliver the clear and simple message here in London that the rest of Europe is not prepared to pay almost any price to keep Britain in the European Union.

"I am afraid these hopes will be dashed too."