Germany's deputy finance minister Steffen Kampeter has said he wants the UK to remain in the European Union, adding that the EU will “find ways to offer Britain a good chance to stay in".
Speaking to Newsnight on Monday, Kampeter argued that Britain "opting out" would be a “catastrophe”.
“We are not alone in stating that the Brits should stay in – [Italian Prime Minister] Matteo Renzi stated yesterday it would be a catastrophe [if Britain left]," Kampeter told Evan Davis. “We want them [Britain] in and we will find ways to offer Britain a good chance to stay in. And please do not forget opting out is not economically very preferable to the United Kingdom and has many disadvantages.”
The minister also said it was important for the periphery countries within the EU - Ireland, Spain and Portugal - to continue with austerity and structural reforms.
"They fixed their budget deficits, some fixed their financial challenges, and after they were back on track they exited European solidarity… these are three success stories."
David Cameron has promised to put immigration at the heart of his plan to renegotiate the UK's relationship with Brussels before an in/out referendum by the end of 2017 if he remains in Number 10.
On Britain's call for EU treaty change, he said: "I don’t belong to those who say ‘there’s no chance of treaty changes’. Wolfgang Schauble made several proposals for example for treaty changes are necessary to make more effective governance of the eurozone.
"The pledge for the finance minister for the European commission or ways to be more legitimate democratic decisions on the fiscal side… this needs treaty changes.
"So if I would say the call for treaty changes coming out of Downing Street is something evil I would counterargument my own proposals. It’s quite clear we need treaty changes. Whether they are realistic in the short term we have many negative arguments but they are necessary.”
Speaking on BBC1's Andrew Marr Show over the weekend, former Prime Minister John Major said that the EU needs reform if Britain is to remain within the Union.
He said: "We aren't seeking to end free movement, but what has been happening over the last few years has been such a huge bulge in the amount of migrants coming to the UK - our population has risen by about 7% in a decade and at the present rate the British population would rise in a few decades by 25% while the German population would have fallen.
"I think as people begin to see the particular circumstances that we face I think there will be a good deal of sympathy for the difficulty, and the European Union has a good deal of finding a way around difficult corners like this."
The former premier insisted he is not anti-immigration, saying "we wouldn't have a National Health Service without migrants, we would not have a transport system without migrants", but the problem is "purely numbers, and it may only be relatively short-term".
He added: "I see it as a shortish-term problem, maybe not a year, maybe longer, and we need a little help over that period."
Sir John said he believes a way can be found to make changes without altering the fundamental principle of free movement.
"I think there are some practical things that could be done that don't infringe the principle but do meet the problem," he said.
The former Tory chief said Mrs Merkel is not the only leader opposed to changes in free movement rules, but there are other countries who share the UK's concerns.
"It's not just Angela Merkel, of course she is hugely important... but it is an agreement we have to have across the European Union.
"It's not only we who face trouble. Many of the far-right parties, many of the anti-social parties who offer nothing but negativity across Europe - in Greece, in Sweden, in many countries including our own - have an antipathy to immigration because immigration is seen by their populations at too high a level, as causing difficulties.
"It's not just a uniquely British problem. It's uniquely difficult for us, because of the numbers and because we, for example, are a fraction of the land-space of France or Germany."