Chirac tries to lift sagging French confidence

PARIS - President Jacques Chirac today called for national unity and a new start after a string of morale-sapping setbacks for France, but offered nothing new to lift the gloom or boost his own fading fortunes.

Chirac defiantly declined to rule out seeking a third term as president in 2007, reiterated pledges to reduce unemployment and said France still had influence in the world despite its rejection of the European Union constitution on May 29.

But the 72-year-old leader looked tired and uninspired in his annual Bastille Day television interview after a slump in popularity since the EU constitution defeat and Paris' failure on July 6 to win the race to host the 2012 Olympic Games.

"We need ambition and unity. It is with ambition and unity that we will get out of our difficulties," Chirac said in the garden of his Elysee Palace in his annual interview on the anniversary of the French revolution of 1789.

He said a positive debate on the state of Europe had emerged from the referendum on the EU constitution and this had given him new energy and ambition, adding: "We must use this strength to go faster and further in the right direction."

In a comment that appeared aimed at outspoken Interior Minister Nicolas Sarkozy, he added: "All of this assumes politicians set an example and are united, unified and together with the sole aim of serving the French people."

Sarkozy, who has presidential ambitions, was quoted by French media as saying earlier this week that he did not believe the president should give his traditional nationwide interview if he had nothing to say.

Chirac allies hailed his performance as combative but Francois Hollande, leader of the opposition Socialist Party, said: "This is a president at the end of his reign."

"He doesn't listen," said Communist Party leader Marie-George Buffet. "And no one listens to him any more."

FIGHTING UNEMPLOYMENT

Chirac, who has been president for 10 years, promised to fight high unemployment, the main concern of voters. But he made no new proposals for reducing it from a rate of 10.2 per cent, its highest level in five years.

Chirac also said he favored resuming big income tax cuts that have been suspended by the government, but he made clear this would be hard and set no date for doing so.

He also called for closer cooperation between the 12 euro zone countries and the European Central Bank in efforts to boost economic growth, although the ECB is defending its independence.

Chirac was vague about his political ambitions, declining to say whether he plans to run in the 2007 presidential election and whether his ally Prime Minister Dominique de Villepin or rival Sarkozy is better placed to succeed him.

"I think it is too soon to discuss this matter," he said.

Pressed on his plans, he said: "You'll know when the time comes."

Chirac was largely on the defensive but took a tough line in the row with Britain over the EU's finances which helped block a deal on the bloc's 2007-2013 budget at a summit last month.

Britain said it would agree to concessions over its annual budget rebate from EU coffers only if there was a broad review of EU spending, including subsidies to French farmers.

Ruling out concessions on this, Chirac said: "I feel sure of myself because I am defending values which are certain."

Chirac also defended France's economic and social model, which has been often been compared unfavorably with Britain's system in recent weeks. He said he had great esteem for British Prime Minister Tony Blair, despite their differences.

- REUTERS