Sarkozy touts investments as election race heats up

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French President Nicolas Sarkozy promised massive investments in education, research and nuclear power Monday, touting his economic record as a top rival entered the 2012 presidential race.

As Sarkozy held a major news conference, the 2012 campaign heated up with the opposition Socialists declaring that their party leader Martine Aubry, 60, would announce her bid to win a presidential nomination on Tuesday.

"If France wants to remain a great nation and preserve and finance its social model, it must invest massively: innovation, research, universities, health, digital, industry," Sarkozy told his news conference.

His appearance was ostensibly aimed at reviewing his 35-billion-euro ($50-billion) "big loan" stimulus programme launched in 2009 to fight the economic crisis, but circumstances gave it a strong electoral flavour.

Sarkozy has yet to formally announce a re-election bid, but has already clearly adopted a campaign schedule 10 months ahead of the vote and no other serious challenger has emerged from within his right-wing UMP party.

Aubry's allies present her as a candidate of the people, at a time of high unemployment and increased mistrust of the political elite.

Sarkozy's popularity is stuck at under 30 percent, raising the pressure on him to prove his economic credentials.

"I do not underestimate the suffering of our compatriots during the crisis, with half a million more unemployed. But it is less than in other countries," he said Monday.

Sarkozy laid into his rivals, saying the Socialists' threat to repeal his policies such as reducing the civil service payroll and raising the retirement age "would mean an explosion of the debt and deficits."

Socialist Party spokesman Benoit Hamon retorted in a news conference that the soaring public deficit -- currently more than seven percent of GDP -- was due to tax cuts by Sarkozy and other right-wing governments.

Sarkozy said the "big loan" scheme will have dished out 20 billion euros by the end of 2011, while insisting on the need for controversial reforms such as liberalising universities' financing to make them competitive.

France will also invest one billion euros ($1.4 billion) in future nuclear power development while boosting research into safety, he added.

Recent opinion polls suggest either Aubry or former Socialist leader Francois Hollande could comfortably beat Sarkozy in the first round of voting, and would then have to win over centrist voters in the run-off.

An IFOP poll published Monday showed Hollande with 43 percent of support from party members, ahead of Aubry with 34 percent. The party chooses its candidate at a primary in October.

The Socialists were thrown into turmoil in May when top candidate Dominique Strauss-Kahn, who had polled as favourite to beat Sarkozy, was arrested in New York, accused of sexually assaulting and trying to rape a hotel maid.

He denies the charges, but the scandal wrecked his electoral hopes and forced him to resign as head of the International Monetary Fund (IMF).

Since Strauss-Kahn's downfall, Hollande has moved up in the polls to become the top contender, with Aubry also polling as able to beat Sarkozy.

Shock polls last month showed the leader of the far-right National Front, Marine Le Pen, could beat Sarkozy in the first round of voting. A CSA poll last week indicated her rating had declined but was still strong at 16 percent.

Socialist Party sources said Aubry would announce her candidacy in a speech scheduled at 0930 GMT on Tuesday, the deadline for Socialists to apply to run in the primary, in her hometown of Lille.

Meanwhile, a minor reshuffle of Sarkozy's government is likely in the coming days if Finance Minister Christine Lagarde is chosen to replace Strauss-Kahn as head of the IMF.

The fund's board is due to name the new managing director by Thursday.

© 2011 AFP

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