EU leaders to endorse Mediterranean Union

By Ingrid Melander

BRUSSELS (Reuters) - European Union leaders were set to give formal blessing on Friday to a French proposal for a Mediterranean Union to boost ties with the bloc's southern neighbours, a draft final statement showed.

But the plan presented by French President Nicolas Sarkozy and German Chancellor Angela Merkel to a 27-nation EU summit is a pale shadow of the grand design initially proposed by Paris.

"The European Council approved the principle of a Union for the Mediterranean which will include the member states of the EU and the non-EU Mediterranean coastal states and be an upgrade of the Barcelona process," the draft seen by Reuters said.

EU leaders are due to approve it at the end of a two-day summit on Friday.

They will invite the executive European Commission to propose detailed arrangements for launching the new Union at a summit in Paris on July 13, after months of fierce resistance by Berlin forced Paris to drop the most controversial features.

The concept has shrunk from an international forum grouping only states with a Mediterranean coastline and involving nine new agencies and a bank, to a mere regular summit of EU and Mediterranean countries with a joint presidency -- which may yet be dropped -- and a small secretariat.

Merkel said the original plan would have split the EU and siphoned off common funds for the benefit of a few members and their former colonies.

But Sarkozy told a midnight news briefing: "I never had the idea of excluding any EU states...I never regarded it as a rival to the EU."