France wants quick British divorce from EU, Germany cautious

* French foreign minister wants quick UK exit negotiations

* Germany’s Steinmeier warns against hysteria and paralysis

* EU’s Juncker says Britain can’t cherry pick divorce terms

BERLIN, June 25 France’s foreign minister called on Saturday for the European Union to move ahead quickly to seal the terms of a British exit, arguing that the other 27 members needed to give the bloc new purpose or risk populism taking hold.

“Negotiations have to go quickly in the common interest,” Jean-Marc Ayrault said on his way to a meeting in Berlin of foreign ministers from the six founding members of the EU – Germany, France, Italy, the Netherlands, Belgium and Luxembourg.

Britain voted on Thursday to leave the EU, forcing the resignation of Prime Minister David Cameron and dealing the biggest blow since World War Two to the European project of forging greater unity.

The EU’s other members and the British government must now work out the terms for the country’s departure and future relationship with the bloc.

European Commission President Jean-Claude Juncker told German newspaper Bild that Britain must consider what kind of a relationship it wanted with the EU but it could not pick and choose.

“There will definitely not be any cherry picking,” he said.

“Out is out,” Juncker added. “Now the priority is a clean divorce, because citizens and businesses need legal certainty.”

German Foreign Minister Frank-Walter Steinmeier, hosting Saturday’s meeting, struck a more cautious note but said it was essential to preserve the “project of freedom and stability” that the six founding EU members had forged.

“It is completely clear that we now have a situation that allows for neither hysteria nor paralysis,” Steinmeier said, adding that EU leaders must address the challenges of migration, security and unemployment.

“We must not resort to hectic activity, and act as if all the answers are ready. But after the British decision we mustn’t lapse into depression and inactivity,” he told reporters.

Ayrault said Saturday’s meeting should not focus too much on a plan drawn up by German and French officials for a flexible EU that would envisage “allowing space” for member states that are not ready for further integration. “We shouldn’t fixate on the idea of flexibility. There already is a two-speed Europe,” he said.

Looking to a summit meeting of EU leaders, including Cameron, next week, the French minister added: “There will be a lot of pressure on Cameron on Tuesday to move ahead.”

“We have to agree between the 27 to say that after a certain date this episode is finished,” Ayrault said, though he did not say such a deadline would be set on Tuesday. “We have to give a new sense to Europe, otherwise populism will fill the gap.”

London’s financial centre will lose its prized “EU passport” if Britain fails to secure continued access to the bloc’s single market in its exit talks, ECB Governing Council member Francois Villeroy de Galhau warned on Saturday.

“If tomorrow Britain is not part of the single market, the City cannot keep this European passport, and clearing houses cannot be located in London either,” Villeroy, who is also governor of the French central bank, told France Inter radio.

That could be an opportunity for financial centres in the euro zone including Paris, Villeroy said.

Germany Economy Minister Sigmar Gabriel said he was uncomfortable with the prospect that Germany could benefit economically from Brexit.

“It could be that some companies move their headquarters to Europe. Frankfurt is already being discussed,” Gabriel told the Handelsblatt business daily. “But I don’t wish that on the Brits at all.” (Additional reporting by Ingrid Melander in Paris; Writing by Paul Carrel; Editing by David Stamp and Alexander Smith)