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After hard bargaining, EU set for deal on new leadership

An European Union flag flutters outside of the European Parliament in Brussels October 12, 2012. REUTERS/Francois Lenoir
An European Union flag flutters outside of the European Parliament in Brussels October 12, 2012. REUTERS/Francois Lenoir

By Alastair Macdonald and Julia Fioretti

BRUSSELS (Reuters) - European Union leaders are set to end weeks of wrangling over top jobs in Brussels and agree on Saturday on who will fill key posts in EU institutions that face major challenges from a combative Russia and a stuttering economy.

A summit in Brussels that was called after a pre-vacation meeting two months ago ended in deadlock is likely, diplomats and officials said, to hand Poland's conservative prime minister the influential role of European Council president and Italy's little tested young foreign minister given the running of the EU's common diplomatic efforts. But nothing is yet certain.

Russia's assumed military intervention in Ukraine will also be discussed when the prime ministers and presidents meet from late afternoon, but officials doubt they will do more than agree to study stepping up their economic sanctions on Moscow.

EU foreign ministers meeting in Milan on Friday spoke of toughening an arms embargo, extending the list of individuals or sectors targeted by economic sanctions and also of sending military equipment to Ukraine.

Ukrainian President Petro Poroshenko will be in Brussels on Saturday, aiming to persuade the EU to do more to deter Russian President Vladimir Putin from supporting separatist rebels.

But while former Soviet satellite states in the east are keen for tougher measures, the western powers, notably Germany, France, Italy and Britain, fear damaging their own fragile economies by losing Russian business - and are even warier of risking an interruption in Russian gas supplies this winter.

DEAL IN MAKING

In a deal that would balance the interests of left- and right-wing factions across the bloc, eastern and western states, northern Europe and the south, as well as satisfy pressure for more women in senior EU roles, Polish premier Donald Tusk could be named Council president in succession to the Belgian Herman Van Rompuy and Italian Foreign Minister Federica Mogherini the bloc's foreign policy chief, replacing Briton Catherine Ashton.

Eastern leaders, alarmed by a resurgent Moscow, resisted the appointment of Mogherini. At 41 and with just six months of experience in Matteo Renzi's center government, they saw her lacking the political weight to stand up to the Kremlin and also handicapped by Italy's dependence on Russian energy.

However, the emergence this week of support for Tusk as Council president - a conservative figure from by far the biggest of the ex-communist states - appears to have forged the makings of a consensus, diplomats and officials said.

That would rule out one-time favorite, Denmark's center prime minister Helle Thorning-Schmidt - who like Tusk has never publicly declared herself a candidate.

Van Rompuy, whose responsibility it is to try to find ways for the 28-nation Council to reach decisions, was in contact with leaders in the run-up to the summit. But a final agreement is unlikely to emerge until they meet in person on Saturday.

Ahead of the summit, French President Francois Hollande will host fellow leaders from the left in Paris in the morning, while European conservatives will meet in Brussels at the same time.

Other elements in striking a deal on the top jobs will be understandings reached on other key roles in the EU's executive Commission, which will be formed in the coming weeks by the incoming Commission president, the veteran conservative former Luxembourg prime minister Jean-Claude Juncker.

His appointment at the last summit in late June followed an acrimonious attempt by British Prime Minister David Cameron to block Juncker, whom London sees as too keen on centralizing powers in Brussels - a movement Cameron wants to reverse and over which he has warned that Britain might even quit the Union.

Britain, France, Germany and other countries are competing to see their nominees secure important portfolios in Juncker's team, such as in economic affairs, trade and energy supply.

The horse-trading over jobs underlines the power of rival national governments over the supranational institutions of the EU. Proponents of a strong political leadership in Brussels that can inspire and rally an increasingly skeptical European public behind the common project may again be left disappointed.

Italian premier Renzi, whose country holds the rotating six-month presidency of the bloc, said on Friday he would propose a new meeting on Oct. 6 to discuss ways to tackle the "really worrying" economic situation across Europe, with growth and jobs elusive and fears of a renewed crisis for the euro currency.

Germany, the leading economic power, has given signs this week of softening its opposition to calls from Italy and France for more leeway to stimulate growth by government spending and the leaders may make statements on the issue on Saturday.

(Additional reporting by Barbara Lewis and Adrian Croft in Brussels, Lisa Jucca and Francesca Landini in Milan; Writing by Alastair Macdonald; editing by Ralph Boulton)

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