Germany will be represented at Thursday's talks by outgoing chancellor Olaf Scholz, but all eyes are already on Merz after he said he was ready for radical reforms to help bolster Europe's security, with US guarantees looking increasingly fragile.

After a handshake before photographers, Costa, who heads the European Council of member states, headed into private talks with Merz.

The likely next chancellor said this week he planned to reform the country's strict constitutional "debt brake" to pump up defence spending and pursue massive infrastructure investments.

Merz's conservative CDU/CSU bloc and the centre-left Social Democrats are in talks to forge a new governing alliance, but the two sides have agreed to try to push through the changes before a government is formed.

On the summit's eve Merz met with European Commission chief Ursula von der Leyen, who has put forward a bloc-wide plan to bolster EU defences by hundreds of billions of euros -- largely by freeing member states to spend much more.

EU foreign policy chief Kaja Kallas held a separate meeting with Merz, posting afterwards that his announcements on German defence were "leading the way."

And Merz also met Wednesday with NATO chief Mark Rutte, who wrote that his leadership will be "crucial" for the coming challenges.

"Germany and Europe must now invest massively in their own defence capabilities. That is the best protection for Europe's security," Merz wrote afterwards.