Reforms to help business competitiveness: Sarkozy

PARIS: French President Nicolas Sarkozy is set to reveal a swathe of new economic reforms on Sunday to create more jobs, improve business competitiveness and convince voters he is the right leader to revive France's sputtering economy.

Three months before presidential elections in which Sarkozy has yet to announce his candidacy, the incumbent is focused on economic competitiveness, amid a long-running euro zone crisis and what many economists believe is a mild recession in France.

In the interview at 1900 GMT to be televised on nine channels, Sarkozy will address ways to stem rampant unemployment now at a 12-year high by helping employers hire more staff while becoming more competitive on the international market.

He will unveil plans for a so-called "Social VAT" in which social contributions made by employers will be cut and consumers will instead pay a higher value-added tax.

Le Monde reported on Saturday that the German-inspired "Social VAT" would raise VAT by 1.6 percentage points to 21.2 percent.

Sarkozy is also expected to give details of a financial transaction tax in France that he hopes will subsequently be adopted across the European Union.

The president's speech comes exactly a week after his Socialist rival, Francois Hollande, kicked off his campaign offensive with a speech slamming the world of high finance.

Hollande revealed later in the week his plan to raise taxes on banks, large companies and the rich to help stem the deficit, while spending on education.

An Ifop poll published on Sunday in Le Journal du Dimanche indicated that voters considered Hollande the best candidate to tackle unemployment and debt reduction.

Forty-six percent of voters said they had more confidence in Hollande to fight unemployment, versus 22 percent for Sarkozy. Some 34 percent chose Hollande as the candidate to best handle the public debt, versus 32 percent for Sarkozy.

The president has tried in recent weeks to cast himself as the more experienced candidate with the international stature and clear-headedness to guide France through recent turmoil at the eurozone level and at home.

On Saturday, Prime Minister Francois Fillon told a conference of the centre-right UMP party that globalization requires France to be more competitive and innovative, while demonstrating more budgetary discipline.

"Who other than Nicolas Sarkozy can defend our interests, reform the country, unite European energy, and convince the great powers of this world?" said Fillon.

He dismissed the Socialists' agenda as an untenable dream.

"The Socialist dream isn't what France needs. In a period of crisis, it's lucidity, sang-froid, it's pragmatism that counts," he said. "We will not fix France through dreams we will fix it through work, through initiative, investment and through courage."

Copyright Reuters, 2012