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Chirac accepts defeat on EU vote


• French territories begin EU voting
• Dutch PM: Vote on treaty not me
• Giscard in last-ditch 'Yes' appeal
• Chirac urges 'Yes' to EU charter
• Barroso: 'No' vote failure for EU
• Leaders bid to save EU charter
* Permanent EU president to replace six-month rotating presidencies

* EU foreign minister to conduct common foreign policy

* Qualified majority voting in most areas with vetoes limited

* Commission to be reduced to 15 with 10 non-voting associates

* Policy areas covered by European Parliament up from 34 to 70

* Legally binding Charter of Fundamental Rights
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Jacques Chirac

PARIS, France (CNN) -- French voters have rejected a proposed European Union constitution, turning aside an extensive pro-ratification campaign by President Jacques Chirac and throwing a wrench into plans for closer European integration.

With votes counted in all of France and its overseas territories, the "no" camp had 54.87 percent, with only 45.13 percent voting "yes," according to figures released by France's Interior Ministry.

Chirac on Sunday acknowledged his country's decision. In a national address, he said French voters had made their "sovereign decision, and I note it."

Chirac said that he intended to meet with the European Council in Brussels on June 16 and "defend the position of our country." He added: "France will continue to maintain its full positions respecting its commitments, and I will assure that."

The defeat represents a humiliating one for Chirac, whose country -- a founding member of the European Union -- is the first to reject its charter. He becomes only the second French leader, after Gen. Charles de Gaulle, to lose a referendum since the founding of the French Fifth Republic in 1958.

European Commission President Jose Manuel Barroso said leaders "need to do more to explain the true dimension of what is at stake, and the nature of the solutions which only Europe can bring."

"There will be time for that debate, of course, but I think one thing is sure: we should, together, try to put Europe back on track again," Barroso said.

British Foreign Secretary Jack Straw told reporters in London he was saddened by the result and called for a "period of reflection" among member states before deciding how to proceed.

"The result raises profound questions for all of us about the future direction of Europe; about the challenges to us from the rest of the world; about the ability of the European Union to respond to these challenges and to the demands of its citizens," he said.

"Britain should, and will, play a full part in these debates in the months ahead."

Chirac's decision to give the public a referendum on the issue was a risky one; had he sent the issue straight to parliament, approval was more likely, CNN's European political editor Robin Oakley said.

Before the referendum, Chirac said he would not resign if the French voted "No." But he has hinted that he might respond to calls to sack his unpopular Prime Minister Jean-Pierre Raffarin and make policy changes.

In his address late Sunday, he made no mention of government sackings, but said he "intends to respond" to voters' wishes within days.

Meanwhile, the euro dropped against the Japanese yen and the U.S. dollar in early Asian trading Monday. But Graham Bishop, a London-based financial affairs consultant, said the European currency was unlikely to undergo a prolonged slide.

While the French vote was "clearly bad news" for the euro, which was introduced in 1999, the major alternative -- the U.S. dollar -- is being dragged down by high budget and trade deficits, he said.

"There may be short-run weakness in the euro, but I would doubt it will be significant or sustained," Bishop said.

Polls in the Netherlands, which holds its own referendum on the constitution on Wednesday, suggest the "No" camp there is leading by 60-40 percent, and the momentum is likely to gain with the defeat in France, Oakley said.

Regardless of the outcome in France and the Netherlands, a European Commission spokesman confirmed that the ratification process for the constitution would go ahead.

"The procedures have been completed in nine countries representing over 220 million citizens. That is almost 49 percent of EU population. The Commission thinks this is a very important reason why the ratification procedures should go forward," Mikolaj Dowgielewicz told The Associated Press.

A divided France

The campaign has divided France and become a referendum on the government's economic record as well as the future of Europe.

Backers contend the constitution, which EU leaders signed last October, will strengthen Europe and France, make EU operations more efficient and let Europe speak with one voice on global issues.

Opponents worry about losing national identity and sovereignty, and the influx of cheap labor -- just as France struggles to reduce high unemployment.

Germany became the ninth country to ratify the constitution when the upper house of parliament voted Friday in favor of the treaty that embodies it. Germany followed Austria, Greece, Hungary, Italy, Lithuania, Slovakia, Slovenia and Spain in approving the text. The Dutch vote Wednesday.

The Associated Press reports that the treaty did leave open the possibility for another vote to be held, if at least one nation "encountered difficulties" in getting approval.

The treaty was drawn up by a 200-person panel of parliamentarians headed by Valery Giscard d'Estaing, a former president of France.

"I voted 'No' in all conscience, having read the text, due to the lack of will to solve Europe's number one problem today, which is unemployment," said Armel Bompart, 52, a civil servant also voting in Strasbourg, home to the European parliament.

"I voted 'Yes' because I think Europe is important," Julie Lacour, 21, a student voting in Strasbourg in eastern France, told Reuters. "It's been 60 years that we've been trying to construct Europe. Now we must keep going forward and not go backwards."

Copyright 2005 CNN. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed. Associated Press contributed to this report.

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