HAMPTON COURT, England (AP) – European Union leaders moved no closer to resolving their divisions over a new EU budget yesterday, nor how to appease renewed French threats of vetoing world trade talks amid calls that Europe needs to accept urgent reforms to keep up with rising economic powers China and India.

A vague agreement to work for economic renewal pushed by summit host British Prime Minister Tony Blair did little to clear up a sense of paralysis and drift in the 25-nation bloc.

Blair’s one-day informal talks were focused on pushing his counterparts to accept that more change was needed in wake of the effects of globalization and also to show Europeans that the EU was a benefit to their every-day lives.

“People want to push Europe forward again,” Blair said at the end of the talks.

He said the leaders agreed to work toward cutting red tape, opening up services markets to more competition, crafting a common energy policy to cope with high oil prices, trimming welfare systems and boosting funds for research and education.

Blair said there was also broad backing to set up a billion-euro “globalization adjustment fund” which officials said would be used to help workers in the EU hit by job losses blamed on global competition, as well as boosting the fight against illegal immigration.

French President Jacques Chirac agreed the fund was a good idea, but issued strong threats at the talks that France would not accept more cuts in farm aid in exchange to get an EU budget deal or a world trade agreement.

Chirac said he may veto an agreement on world trade talks if the EU makes excessive concessions in cuts in farm subsidies and import tariffs, raising fears the EU’s already sensitive unified stance at the world trade talks was set to implode.

“There is no way we are going to take an extra step,” Chirac told reporters. “A red line has been drawn and we will not overstep it.”