The EU executive is standing firm behind strict eurozone deficit rules being breached by France as it struggles to cope with an increasingly gloomy economic landscape.

Officially Raffarin's visit is focussed on a French request for EU aid for damage caused by recent devastating fires which have ravaged some 50,000 hectares of forests.

But European Commission chief Romano Prodi, who met Raffarin for a one-to-one talks before a lunch with the whole EU executive, has indicated that the thorny budget issue is likely to be broached.

"It is clear the commission cannot change principle rules depending on" which country is concerned, he said on the eve of Raffarin's visit. "This type of meeting will never refuse to tackle any problem."

The European Stability and Growth Pact stipulates that euro-zone countries are not allow to run up public deficits in excess of 3.0 percent of gross domestic product (GDP).

However, the French deficit ratio exceeded that level in 2002 and looks set to do so again this year and possibly in 2004 as well.

Commission spokesman Gerassimos Thomas confirmed that the French budget situation will be discussed with Raffarin "but in the context of a general discussion on the economy."

"The visit has several aims .. the economy will be very important, we are going to discuss the economic situation, progress on structural reforms, economic perspectives as well as the budget situation," he added.

Raffarin is also likely to discuss the main political challenge facing the EU in coming months: negotiations on an EU constitution, likely to see sparks fly once an intergovernmental conference (IGC) opens in Rome on October 4.

He may also face questions about government support for a number of French companies, including a bailout of engineering giant Alstom, which is being investigated by Brussels to see if it breaches EU state aid rules.

TERRA.WIRE