PARIS (MNI) – France’s President Nicolas Sarkozy vowed Wednesday
that he would press ahead with his government’s reform agenda despite a
stinging setback for his ruling UMP party in last Sunday’s regional
elections.

“We must continue with the reforms. To stop now would be to simply
ruin what we’ve already accomplished,” Sarkozy said in brief remarks
following a cabinet meeting at the Elysee Palace.

“Nothing would be worse than changing course,” he added. “Our
country has suffered too much already from hesitation and incessant
changes of course.”

Sarkozy said his government would continue with reforms that are
aimed at stimulating job creation and improving France’s overall
competitiveness. These include targeted tax cuts and other hiring
incentives for French businesses, as well as research aimed at
technological innovation.

The decision to reform is “an absolutely capital choice,” Sarkozy
said. “We took it because our priority is work.” He reiterated his
determination to “refuse any tax increase.” And, he said, “we must
continue to invest in the future, in the universities.”

Sarkozy’s remarks come just days after his party was rebuked in
regional elections that gave an opposition leftist coalition led by the
Socialist Party control in 21 of the country’s 22 mainland regions. The
UMP won in only one region, Alsace, which it already held. It lost
control of Corsica to the left and failed to wrest away any of the 20
continental regions already held by the opposition.

But Sarkozy said he wouldn’t be deterred by the outcome of the
polls, because France’s future was riding on the success of his mission.
“Competition won’t get any easier tomorrow, it will be harder,” he said.

He hinted but did not specify that he would continue to pursue the
goal of a CO2 tax on heavily polluting companies, saying “I confirm
without ambiguity our choice in favor of an environmental tax policy.”

Sarkozy also said he would rather risk a crisis in Europe than to
see EU’s common agriculture policy “dismantled.” Railing against
speculation in commodities that makes it difficult for farmers to
survive, he pledged he would “not let our agriculture die.”

–Paris Newsroom, +331-42-71-55-40; bwolfson@marketnews.com

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