Germany and France plan to launch this month a "New Deal for Europe" against youth unemployment, which has topped 50 percent in several countries, with credits for companies that create jobs, a news report said Monday.
Under the initiative, billions of euros (dollars) in loans from the European Investment Bank (EIB) would be used to promote education, training and job placements for young people, reported Germany's Rheinische Post daily.
The plan will be presented in Paris on May 28 by French Labour Minister Michel Sapin, his German counterpart Ursula von der Leyen and a group of companies, said the report citing unnamed government sources and conference organisers.
German Finance Minister Wolfgang Schaeuble and his French counterpart Pierre Moscovici would also join the town hall-style meeting organised by the EU bank and the German-American investor and philanthropist Nicolas Berggruen.
The "New Deal" -- named to echo US president Franklin D. Roosevelt's Great Depression recovery plan -- comes amid fears of a lost generation, especially in Greece and Spain where almost two out of three young people are unemployed.
A debate has raged over the tough austerity promoted by Germany and others to reduce European debt mountains and proposals for stimulus programmes that would revive struggling economies but also add to public deficits.
A German labour ministry spokesman told AFP however that it was "neither a purely German initiative, nor a Franco-German initiative".
"In the end it affects the whole eurozone," he added.
The new plan builds on a six-billion-euro ($7.8 billion) initiative by the European Union to combat youth unemployment. That money could be leveraged and used as guarantees to raise up to 10 times more in loans, said the report.
"It would be conceivable to establish a link between credit conditions and the creation of jobs and training opportunities" by companies that take the loans, EIB President Werner Hoyer was quoted as telling the newspaper.
He said Germany's so-called dual system of formal education and on-the-job training could be introduced in southern Europe, and the Erasmus university exchange programme widened to non-academic training, the report said.
Asked about the initiative at a regular government news briefing Monday, spokesmen for the German labour and finance ministries confirmed their respective ministers would attend the Paris conference with their French counterparts.
The labour ministry spokesman told reporters that there was "close coordination" between von der Leyen and Sapin and said the conference would tackle how to motivate companies to hire young people.
But the German spokesmen did not give further details.
EU social affairs and employment commissioner Laszlo Andor was due to highlight during his visit to Madrid on Monday the European Commission's "Youth Guarantee" proposal, agreed by member states in February, his spokesman said.
Under the scheme, under 25-year-olds would be able to receive ongoing training, a work placement or an apprenticeship within four months of leaving education or losing their job.
Andor was to stress the urgency for EU states to put in place measures to implement the scheme, spokesman Jonathan Todd told reporters in Brussels.
"It is important not to reinvent the wheel," Todd added, however.
"We have a measure that has been agreed by all member states ... so young people do not waste their time when unemployed but are rather helped acquire the skills that will make them employable in the future."