The leaders of Britain, France and Germany on Wednesday held a three-way summit they said was aimed at transforming the European economy and hit out at critics accusing them of forming a dominant elite.

Hosting the talks, German Chancellor Gerhard Schroeder said their goal was to help make Europe "the most competitive region in the world".

Flanked at the round table by British Prime Minister Tony Blair and French President Jacques Chirac, he said they wanted to achieve common solutions for common problems "in order to give a new impetus to Europe".

"That is the goal -- nothing more, nothing less," he went on, defending the talks against critics as "useful" and "a helpful contribution toward a better functioning, expanded Europe".

Blair said the three realised they still had "a long way to go" to realise the ambitious objectives of the European Union's summit in Lisbon in 2000, which first set the goal of making the bloc the world's most competitive region by 2010.

Chirac called for more joint scientific projects like the Galileo satellite system and suggested creating a network of elite European universities.

The summit comes at a critical time as the 15-nation EU prepares to welcome 10 new members, an expansion its three biggest nations fear will bog down an already cumbersome institution.

At the same time, the talks have been hit by a barrage of criticism from EU countries not invited to join, such as Austria, Italy and Spain, who accuse the Berlin participants of seeking to create an EU "directorate".

But Schroeder recalled that the three leaders had put aside their differences over the Iraq war behind them at a summit in September 2003 to push for a joint defence initiative that was endorsed by the EU at its summit in December.

"The success in defence justifies continuing our discussions (on social and economic problems)," he argued.

The talks were focused on spurring economic growth, encouraging innovation and pushing social and labour market reforms.

Officials said it was a "brainstorming" session to exchange ideas and draw up joint proposals for the next EU summit in March.

The leaders were to draft a letter to Ireland, which currently holds the EU presidency, calling for more attractive EU-wide patent regulations, less industry red tape and better access to risk capital, notably for companies starting up or branching out.

Chirac praised Germany's often painful efforts to restructure its economy, saying it had "set an example" with its social and economic reforms.

Each leader was accompanied by a handful of ministers, including those for health, trade and industry, social and labour and in Chirac's case, his prime minister, Jean-Pierre Raffarin.

Another aim of the summit was to make the European Union less unwieldy when it expands from 15 to 25 members on May 1.

Officials said the three countries wanted to refocus the work of the European Commission, the EU's executive arm, and the way it operates, which one German official called "not always coherent".

Schroeder has floated the idea of a "super-commissioner" who would oversee the separate commissioner's portfolios of industry, competition, research and the internal market as well as environment.

German newspaper reports also suggested the three leaders would discuss the future make-up of the European Commission when it is renewed later this year, including who should replace its president, Romano Prodi.

The daily Die Welt said Germany would not put forward its own candidate to replace Prodi but push for a German as the touted "super-commissioner".

At a subsequent dinner, joined by their foreign ministers, the leaders were to discuss international issues ranging from Iraq and Afghanistan to a common EU defence policy and the bloc's draft constitution.

The prime minister of the Netherlands, which takes over the EU presidency from Ireland in July, said Wednesday's three-way summit was not a threat in itself but could become one if Britain, France and Germany took to deciding everything.

"These three countries, the large countries, have to be aware of the fact that they have to cooperate with other couuntries," Dutch Prime Minister Jan Peter Balkenende told reporters.