Gaddafi's first visit to France in 34 years has been accompanied by the signing of several business deals, and human rights groups and the opposition Socialists have accused Sarkozy of putting commercial deals before human rights.

Sarkozy made a point of inviting Gaddafi after Libya in July released six foreign medics accused of infecting Libyan children with HIV. Paris helped broker the deal.

"Gaddafi is not perceived as a dictator in the Arab world," Sarkozy told Le Nouvel Observateur magazine.

"He is the longest serving head of state in the region, and in the Arab world, that counts," Sarkozy said. "I share the conviction that France has to talk with everyone while standing firm on the values it holds."

Gaddafi took power in 1969 after leading a military coup.

Libya's ties with Western states have warmed since it scrapped programmes to develop weapons of mass destruction in 2003 and agreed compensation for families of victims of bombings of U.S. and French airliners.

But rights group Amnesty International said Libya's return as an international partner had to bring real cooperation on human rights as well as trade issues.

"President Nicolas Sarkozy cannot satisfy himself with the conclusion of commercial agreements without obtaining concrete measures for a real improvement in human rights in Libya at the same time," the group said in a statement.

CONTRACTS CONTROVERSY

In France, the value of the deals signed this week has also sparked controversy.

Sarkozy's office said on Monday the two countries had signed contracts worth some 10 billion euros. But several firms and industry sources played have down the scale, saying the deals appeared to be the finalisation of deals already reached or estimates of contracts being negotiated.

"This visit is turning into a tragicomic farce," Socialist Arnaud Montebourg told parliament. "It ridicules France, weakens France's voice, tarnishes the universality of its message."

Gaddafi told French business leaders on Wednesday improved political ties between Tripoli and Paris would help firms.

"Gaddafi said French firms were appreciated in Libya," Yves-Thibault de Silguy, the chairman of French construction group Vinci, quoted Gaddafi as telling business leaders during a meeting in Paris's Ritz Hotel.

"He said that in the past, many firms had suffered from political decisions taken by certain countries and that today, the political climate had largely changed. He thought his was of a nature to help the development of French firms in Libya."