The chancellors of Germany and Austria have pledged to try and put differences over the presence of the far-right Freedom Party in the Austrian government behind them and to work together constructively.
Gerhard Schröder said he did not regret having taken part in political sanctions against Austria after Joerg Haider's anti-foreigner Freedom Party entered government last year, but this was now in the past.
"I do not see them as a mistake, otherwise I would not have made this decision," he told a news conference in Vienna after meeting Austrian Chancellor Wolfgang Schuessel.
"But it is clear - and that was part of our discussions - that we are dealing with the present and the future and not with the past. There are no problems between the two of us."
Schuessel said Austria had been hurt by some of the things said about it last year and insisted that the dignity of a small nation and the legitimacy of its democratically elected government should be respected.
"There is one Austrian government, one German government and working relations must encompass all areas," he said. "It is important that we work together on all levels."
Schröder's first visit to Austria since the new government took office in February 2000 has been marked by controversy because he spent more time with fellow Social Democrats - now in opposition in Vienna - than with the government.
He also refused to meet Freedom Party ministers.