Prime Minister Stephen Harper and German Chancellor Angela Merkel both made an appeal Thursday for countries that use the euro common currency to forge a stronger political union.

Harper, in France to meet the country's new Socialist leader, called the 17-country eurozone a "half-done project" that lacks the tools to contain Europe's spiralling debt crisis.

"The problem here is we have a monetary union, but the European Union and the eurozone lack the strong institutional structures that normally go with a monetary union," he told reporters.

'We need not just a currency union; we also need a so-called fiscal union, more common budget policies. And we need above all a political union'—German Chancellor Angela Merkel

"They don't have the kind of central bank authority that a monetary union usually has, they don't have the kind of banking regulatory authorities that you usually see with a monetary union and they don't have a strong central government with a kind of dominant fiscal policy that you normally have with a monetary union."

Merkel delivered a similar message on a Thursday morning breakfast show, calling for countries to gradually give up more powers to Europe.

"We need not just a currency union; we also need a so-called fiscal union, more common budget policies. And we need above all a political union," she said.

"That means that we must, step by step as things go forward, give up powers to Europe as well."

Harper said European leaders need to come up with a plan — and soon.

"They're not going to have growth in Europe unless they establish some confidence in markets," he said.

"And it's going to be very difficult to establish confidence without a plan to address some of these issues."

Breakfast with French president

Harper said he stressed the need for quick action over breakfast Thursday with French President François Hollande at the Elysee Palace in Paris.

The meeting came a day after Hollande's Socialist government announced it would lower the age of retirement for certain workers to 60 years old from 62.

Canada and some European nations are going in the opposite direction. Harper's Conservative government plans to postpone Old Age Security payments to 67 from 65, although the changes won't start to take effect until 2023.

The move to lower the retirement age is estimated to cost France 1.1 billion euros next year, and is expected to rise to 3 billion euros by 2017. However, critics say the cost will actually be much higher.

France plans to pay for the move by a small rise in payroll charges paid by employers and employees.