Europe set for revamp under new leadership

By Paul Taylor, European Affairs Editor

BRUSSELS (Reuters) - After two years in the political doldrums, the European Union is poised for a potential leap forward under new leaders who will emerge this week.

Conservative Nicolas Sarkozy, winner of Sunday's French presidential election, is committed to a slimmed-down, quick treaty modernising the EU's institutions to replace the more ambitious constitution rejected by French and Dutch voters.

Sarkozy, 52, has pledged to relaunch Europe fast in tandem with German Chancellor Angela Merkel after a bout of self-doubt that followed the French and Dutch referendums in 2005.

Reaching out to the rest of Europe after his triumph, Sarkozy said: "I want to launch a call to our European partners, with whom our destiny is deeply linked, to tell them that I have been European all my life...Tonight France is back in Europe."

European Commission President Jose Manuel Barroso said he was confident Sarkozy would help find an early solution to the EU's stalled institutional reform.

EU officials said things would have been much more difficult if his Socialist rival Segolene Royal had won. She had pledged to hold a fresh referendum on an augmented constitution incorporating more social policy.

Across the Channel, British Prime Minister Tony Blair has said he will announce his departure date this week, clearing the way for his almost certain successor, finance minister Gordon Brown, 56, to take over by July.

Brown's European ambitions are less clear. He has criticised the EU as inward-looking, obsessed with its institutions and resistant to free trade and open markets.