Iran said Sunday it would reject any demand to stop what it calls peaceful nuclear work, a day before European foreign ministers discuss incentives and penalties designed to rein in Teheran's atomic ambitions.

European Union foreign ministers will meet today to work out technical, trade and political sweeteners that would be offered to Iran in exchange for allaying Western fears it is seeking to produce an atom bomb, notably by halting uranium enrichment.

Iran, the world's fourth largest oil exporter, insists its nuclear plans are purely to make electricity and says it will not give up enrichment.

"Any proposal that obliges us to stop peaceful (nuclear) activities would not have value and would not be valid," Iranian President Mahmoud Ahmadinejad said in a speech broadcast on state television.

He accused the Europeans of living in a "colonialist world" and said Teheran would not accept decisions reached in Brussels.

"If they want to decide things that concern us in a place where we are not present, then that body does not have any legal validity or credibility in decision-making," Ahmadinejad said.

Washington agreed to let Britain, France and Germany devise a package of benefits for Iran in return for cooperating, putting back a decision on a possible resolution.

"The aim is to come up with a very attractive package to make it difficult for the Iranian Government to refuse," said a senior envoy from one of the so-called "EU3" countries.

A draft statement for today's EU meeting stated the bloc was ready to help Teheran develop "a safe, sustainable and proliferation-proof civilian nuclear program" while insisting it halt all enrichment on its soil.

Several Iranian officials have recently focused on saying Iran must be allowed to keep at least an enrichment research program, suggesting Teheran might be ready to scrap plans for industrial-scale production of uranium fuel as part of a deal.

"We should first see what the (EU) proposal is. Anyway, we will not abandon our right. (Nuclear) research and development will remain on Iran's agenda," Foreign Ministry spokesman Hamid Reza Asefi told a weekly news conference.

But Washington has said all such work must stop and the draft EU proposals rule out even enrichment for research.

Western diplomats say keeping even a small-scale enrichment program at home would enable Iran to master a technology that could quickly be expanded for military purposes in the future if Teheran chose.

Iran argues that its right to enrichment is enshrined in the nuclear Non-Proliferation Treat (NPT), which allows signatories to carry out the whole range of research, development and production activities to produce nuclear energy.

(China Daily May 15, 2006)