Sarkozy sparks new clash with EU trade chief Mandelson

(BRUSSELS) - Tensions between French President Nicolas Sarkozy and EU Trade Commissioner Peter Mandelson flared on Tuesday, casting an early cloud over France's EU presidency.

The row came as France assumed the six-month presidency of the 27-nation bloc, after Sarkozy, renewing long-running complaints, suggested Mandelson and WTO head Pascal Lamy were trying to force an unfavourable trade deal on Europe.

Mandelson told the BBC that Sarkozy was "undermining" the EU's position in world trade talks, adding that the French leader's remarks would "make it harder" at the negotiations.

"Yes I am being undermined and Europe's negotiating position in the world trade talks is being weakened," he said, adding that the bloc's negotiating strength "comes from our unity".

Sarkozy, who hosted the EU heads and Commissioners in Paris to mark the start of the French EU presidency, earlier said that the British commissioner would be loving the publicity.

"This is someone I have known for a long time and (he) must certainly be delighted with (the) publicity, which I don't hesitate to give him when I don't agree with him," Sarkozy said as EU Commission chief Jose Manuel Barroso stood beside him.

The French leader has long been fiercely critical of the British EU commissioner, accusing him of offering excessively generous concessions on farming in fraught global negotiations at the World Trade Organisation.

The latest row was sparked by Sarkozy saying in an interview with French television channel France 3 on Monday that he would block any WTO agreement that would sacrifice farm production on the "altar of global liberalism."

"Mr Lamy and Mr Mandelson want to make us accept a deal under which Europe would commit to cutting farm output by 20 percent and reduce farm exports by 10 percent," Sarkozy told French television channel France 3.

"That would be 100,000 jobs lost, I won't let it happen," he added.

Mandelson's spokesman challenged Sarkozy's assessment of possible agricultural job losses, arguing that the president's figures were based on what would have happened if the EU had accepted full demands from the Group of 20 emerging market and developing countries.

The negative effects on EU agriculture production would amount to an estimated decrease on average of 1.1 percent, while employment in agriculture would come down by 2.5 percent by the end of the Doha implementation period in 2014, he added.

The Doha round of trade liberalisation negotiations, launched in the Qatari capital in 2001, has long struggled, with all sides refusing to make big concessions.

Lamy, who has called a special meeting of the main WTO players later this month, says that progress on trade in agriculture and industrial products before the end of the month is pivotal to the overall talks.

At an EU summit in Brussels last month, Sarkozy suggested that the recent rejection by Irish voters of the bloc's Lisbon treaty in a referendum could in part be explained by Mandelson's failure to negotiate a tougher bargain at the WTO.

Mandelson has rejected the criticism, which he said had been aimed at making him a scapegoat.

With all 27 European commissioners visiting Paris on Tuesday to mark France's debut as EU president, Mandelson skipped a dinner organised by Sarkozy's office in order to be in Marseille on Wednesday for a meeting with Mediterranean trade ministers.

Ahead of its EU presidency, Paris has not hesitated to criticise the commission for being out of tune with the public.

French European Affairs Minister Jean-Pierre Jouyet said in an interview with Le Parisien on Monday that Sarkozy, who has seen his approval ratings collapse in the year since he was elected, intended to "coach" the EU to be more likeable to the general public.