France's Fillon tells Merkel Russia sanctions are pointless

By Sophie Louet

BERLIN (Reuters) - European Union sanctions on Russia are pointless, the frontrunner in France's presidential election Francois Fillon said on Monday in Berlin, warning Russia and the United States under Donald Trump could forge links that exclude the EU.

Speaking after meeting German Chancellor Angela Merkel, the conservative candidate said the EU was "despised by major powers" because of its divisions and must better defend its economic interests.

The relationship between France and Germany is essential to driving those changes but it must be a partnership of equals, Fillon said, flexing his muscles on the campaign trail to say the two countries must be open about their differences.

"We have differences? Let's accept them instead of denying them. We have divergences on the issue of refugees or on economic policy? Let's face them to better overcome them," he told a conference.

One of those differences is on Russia, where Germany has taken a hard line in favor of EU sanctions over Moscow's annexation of Crimea and its support for a separatist rebellion in eastern Ukraine.

"I am convinced that the economic sanctions are totally ineffective," Fillon told reporters earlier on Monday. "We must find another way to talk," he said, while adding that a gesture from Russia would be needed before sanctions could be lifted.

"I do not want (U.S. President Donald) Trump to talk with Russia at our expense. It would be damaging for Europe if Trump went above our heads, which is not inconceivable," he said.

Fillon, who last year was called an "upstanding person" by Russian President Vladimir Putin, said that in the longer term he would aim for a new economic partnership and a Europe-Russia security conference, once the conflict in Ukraine was resolved. [nR4N1DL001]

Fillon is the frontrunner in opinion polls but his ratings have dropped slightly and surveys predict an increasingly tight race between him, far-right National Front leader Marine Le Pen and independent centrist Emmanuel Macron.

'ON THE SAME PAGE'

With a pro-business focus on cutting public spending, Fillon is generally seen as an ally by fellow conservative Merkel on economic issues.

He sought to allay fears that, if elected, he may let the public budget deficit deteriorate while he reforms the economy by saying that he aimed to keep the deficit as close as possible to 3 percent of economic output next year.

His program had indicated that the deficit could be as wide as 4.5 percent in 2018.

Fillon has also dropped calls to pool the debts of euro zone countries, another sign of goodwill toward Germany. He is in favor of harmonization of tax policies in the euro zone, as is Berlin.

The euro zone must be strengthened, Fillon said during his Berlin visit, saying heads of states should have the upper hand and meet every three months.

Fillon said he and Merkel were "on the same page" on the need not to let the United States impose its laws that have cost European banks billions of euros in fines and other settlements over violations of U.S. sanctions against other countries.

Fillon is the only candidate in the April-May presidential election to be received by the German chancellor so far, in a sign of support from Merkel. But she looks unlikely to give him explicit backing - there was no joint statement or comment from German officials afterwards.

Merkel, up for re-election herself in September, publicly backed conservative Nicolas Sarkozy when he sought re-election in 2012. He lost.

Asked if Merkel would be willing to meet the Socialist candidate, who is to be nominated on Sunday, her spokesman said: "If there is a wish from the French side, then yes". [nL5N1FD24D]

(Additonal reporting by Joseph Nasr, Ingrid Melander and Emmanuel Jarry; Writing by Ingrid Melander; Editing by Janet Lawrence)

You May Also Be Interested In

• Thai central bank minutes show economy expanding, uncertainty remains
• Dollar droops, Aussie jumps after inflation data
• Oil prices inch up after data shows unexpected drop in U.S. crude stocks