France has recalled its ambassador to Syria, Foreign Minister Alain Juppe said on Wednesday, after its diplomatic missions there were attacked amid ongoing protests against President Bashar al-Assad's regime.

"There has been renewed violence in Syria, which has led me to close our consular offices in Aleppo and in Latakia, as well as our cultural institutes and to recall our ambassador to Paris," Juppe told parliament.

EU leaders called on Wednesday for Brussels to have power to rewrite national budgets to ensure the euro survives amid concerns that such discipline could clash with democracy.

European Commission President Jose Manuel Barroso said Brussels would have to be given the power to scrutinize national budgets and demand changes before they are adopted.

France summoned the Israeli ambassador in Paris to a meeting at the foreign ministry Wednesday to protest after an air strike wounded a French diplomat in Gaza along with his wife and daughter.

A spokesman for the ministry said that France's ambassador in Tel Aviv had complained to Israeli authorities over the bombing, and that Israel's envoy had been required to meet with senior officials in Paris.

The United Arab Emirates, which was said to be in final talks with France to buy 60 Rafale fighter jets, said Wednesday the French offer was unworkable and uncompetitive, WAM state news agency reported.

"Unfortunately, Dassault does not seem to realize that political will and all diplomatic efforts could not overcome uncompetitive and unworkable commercial terms," WAM quoted Sheikh Mohammed bin Zayed al-Nahayan, the deputy head of the armed forces, as saying.

France's nuclear watchdog on Tuesday said it had detected traces of radioactive iodine in the air last week after similarly low contamination was reported by the Czech Republic, Poland, Slovakia and Austria.

Concentrations of iodine 131 measuring a few microbecquerels per cubic meter were detected last week at four monitoring stations in northern and eastern France, the Institute for Radiological Protection and Nuclear Safety (IRSN) said.

The authors of a new Eurozone health-check warned Tuesday that France needs wholesale reform even before next year's presidential vote if it is to keep its prized Triple-A credit rating.

"Alarm bells should be ringing for France," says Holger Schmieding, chief economist of Berenberg Bank, Germany's oldest private lender and the principal author of the annual study in partnership with liberal Brussels think tank the Lisbon Council.

The French foreign minister warned Monday that taking military action against Iran over its nuclear program would drag the world into an "uncontrollable spiral."

Alain Juppe said after talks with European Union counterparts that the EU would reinforce sanctions against Tehran by asking the European Investment Bank to freeze loans to the Islamic republic.

EU foreign ministers went into talks Monday calling for increased pressure on Iran over its controversial nuclear program but split over talk of military action.

German Foreign Minister Guido Westerwelle ruled out any idea of military action once and for all, saying firmly on arrival: "We are not taking part in the discussion on military intervention."

Three French hostages kidnapped by al-Qaida militants in Yemen more than five months ago are on their way home, a tribal official involved in their release said on Monday.

"They travelled by land to the Sultanate of Oman and will be flying to France from there," the chief who led the mediation efforts with al-Qaida militants told Agence France Presse.

France on Sunday condemned protesters' attacks on diplomatic missions in Syria and has summoned the Syrian ambassador, the foreign ministry said.

"These attacks are an attempt to intimidate the international community after the Arab League's courageous decision because of ongoing repression in Syria," a ministry statement said after the pan-Arab body suspended Syria.