Strasbourg, France - European Union governments should take over strategic industries which have been hit by the global financial crisis to keep them out of foreign hands, French President Nicolas Sarkozy told the European Parliament on Tuesday.

"Stock exchanges are at historically low levels. I wouldn't like European citizens to wake up in a few months' time and realize that European companies belong to non-European capitals," Sarkozy told the parliament as the current holder of the EU's rotating presidency.

EU member states should consider setting up their own state funds, which could then "coordinate among themselves to bring an industrial solution to the crisis," he said.

That would prevent foreign-owned state funds from buying up the companies "at the bottom of the market, for a vile price," he said.

Sarkozy is a passionate advocate of "economic nationalism," a policy aimed at keeping French-based companies strong and in French hands.

At the same time, many commentators in Europe have expressed alarm at the rise of state-owned "sovereign wealth funds" in countries such as China and Russia, which are seen as willing to use their economic might in order to gain political influence.

However, Sarkozy's latest brainchild is likely to face opposition from northern EU states such as Britain, and from the EU's executive, the European Commission, which is charged with implementing EU competition rules.

In the same speech, Sarkozy called for state support for the European car industry in order to offset the "distortion to competition" created by a 25-billion-dollar aid package offered by the US government to US car makers. (dpa)