Sarkozy meets union leaders, employers to draw up social aid package

Nicolas SarkozyParis - French President Nicolas Sarkozy was set to meet with trade union leaders and entrepreneurs' representatives later on Wednesday to draw up measures to help low-paid workers, the young and the unemployed struggle through the economic crisis.

Sarkozy called the meeting after a general strike on January 29 and widespread street protests demonstrations that same day to demand aid for small and medium-sized companies and measures to increase purchasing power.

Union leaders have called another "day of action" for March 19, putting pressure on the French president to head off a mass social movement that could threaten the stability of his government.

Sarkozy also needs to act in order to restore confidence in his ability to deal with the economic crisis.

In a poll published Wednesday in the online edition of the weekly Le Point, nearly six of 10 respondents said the measures he has so far undertaken "do not go in the right direction."

The daily Le Monde reported on Wednesday that Sarkozy will be offering an aid package of some 2.6 billion euros (3.28 billion dollars).

According to the report, the measures will include tax relief for some 4 million low-wage-earning households, a one-time payment of
100 to 200 euros to certain families and a relaxation of rules governing unemployment payments to those under the age of 26.

However, after handing generous multi-billion-euro aid packages to the French banking sector and the auto industry, Sarkozy is limited in the amount of money he can use to ease social tensions.

On Wednesday, the European Union's executive warned France and five other member nations that they were going too deeply into debt in their efforts to ward off recession.

Under EU rules, national governments are allowed to run a budget deficit of up to 3 per cent of gross national product (GDP). States which violate the rules too flagrantly can ultimately face a fine.

According to European Commission figures, France ran a budget deficit of 3.2 per cent of GDP in 2008, and is projected to reach 5.4 per cent this year.

Sarkozy is scheduled to appear on national television on Wednesday evening to discuss the measures he has taken.

He is also expected to address the escalating violence in the French overseas department of Guadeloupe, where a month-long general strike to demand economic aid has escalated into violence. (dpa)

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