French president Nicolas Sarkozy has promised economic reform which will help to boost employment in the country ahead of the upcoming elections.

Speaking live on TV over the weekend, the premiere said that he would raise VAT from its current rate of 19.6 per cent to 21.2 per cent in October, a move which would save companies money and allow them to boost their staffing numbers.

He also said that companies which have more than 250 staff will be forced to take on five per cent of their staff numbers in interns to give those out of work a chance to learn new skills.

The plans are part of Mr Sarkozy's re-election bid. He is currently far behind his opponent Francois Hollande.

Earlier this month, France, along with Germany, said that employment was the key issue on their agenda for the coming months, as they said that people need to start spending to boost job potential.

Posted by Alex Donnell