France's Sarkozy raises Iran sanction threat

French President Nicolas Sarkozy threatened on Wednesday to press for tougher sanctions on Iran and repeated his call for broad international action to curb financial market abuses, Reuters reported.

In his annual address to France's ambassadors, Sarkozy repeated his longstanding call for a stronger governance of the global economy before a meeting of the Group of 20 nations in the U.S. city of Pittsburgh next month.

"The state has found its place again and it has to keep it by laying out the path toward a new global regulation," he said.

He also lambasted the leadership of Iran and said tougher sanctions would have to be discussed if Tehran does not change its position on the contentious nuclear program that the West believes is aimed at developing a nuclear bomb.

Iran says its program is aimed at civil nuclear energy but the standoff has been fueled by Western criticism of its disputed June presidential election.

"It is the same leaders in Iran who say that the nuclear program is peaceful and that the elections were honest. Who can believe them?," Sarkozy said.

He said the issue would be discussed when world leaders meet in New York at the end of September and he said that if there were no change in Iran's stance, "the question of very substantial strengthening of sanctions will be clearly asked."

Fresh from a three-week vacation in the south of France after a health scare just before the summer break, Sarkozy again staked his claim to leadership in the global response to the financial crisis.

"I will not accept that those who plunged us into the most serious crisis since 1930 are allowed to start again as before," he said. "France will not accept this. Everyone should accept responsibility."

But he said the crisis was also a chance for public authorities to re-establish their position in the global system and he called for Europe to assume its full place in the world, powered by French and German leadership.

"Europe is not an immense NGO ... Europe is a commercial, political, economic, military power and must defend its interests, be it in the Balkans, Georgia, Chad or off the coast of Somalia."

Sarkozy also called for a deal on climate change at the Copenhagen summit in December and urged the creation of a single global body to monitor and ensure summit commitments are met.

He repeated his call for Israel to suspend settlement building in the occupied territory and said Europe would back a new summit in the autumn to go along with the start of a new round of peace talks.