EU leaders shied away from imposing sanctions on Russia last night after President Sarkozy of France received the personal assurance of his Russian counterpart that he would finally withdraw troops from Georgia.

Mr Sarkozy will travel to Moscow next Monday on behalf of the EU to check compliance with the peace plan he negotiated last month, giving Russia a second chance to pull back its forces to their positions before the invasion on August 7.

Speaking after an emergency EU summit on the Georgian crisis Mr Sarkozy, whose country holds the EU presidency, defended Europe’s soft approach by insisting that a punitive or military response would simply have set the EU and Russia on the path to a new Cold War.

The 27 leaders agreed to postpone long-running trade and aid talks with Moscow until it withdraws its troops, which it has promised to do on numerous occasions. Angela Merkel, the German Chancellor, said that Mr Sarkozy was assured by Dimitri Medvedev, the Russian President, that he would meet the peace plan terms.

Russian leaders gave warning that sanctions would do more harm than good. Russia argues that it is justified in deploying troops in a buffer zone beyond Abkhazia and South Ossetia, the Georgian territories that Moscow has recognised as independent.

Russia’s EU envoy dismissed the threat to freeze talks last night. “It is more of a self-punishment for the European Union because this does not improve the EU’s credibility as a negotiating partner,” Vladimir Chizhov said. “We don’t need these talks or this new agreement any more than the EU does.”

Answering accusations that the lack of tough action made the EU a paper tiger, Mr Sarkozy said: “It is a paper tiger which negotiates a ceasefire, which gets a partial withdrawal and is the only body which can solve the situation and is able to help Georgia.

“We do not want to create tension. We do not want to be flexing our muscles talking about sanctions and counter-sanctions. Who would stand to gain from that? Nobody.”

Gordon Brown won support from Ms Merkel, as well as Donald Tusk, the Polish Prime Minister, and the leaders of the Baltic states, for a concrete demonstration of EU anger at Russia’s military aggression by putting negotiations on a new EU-Russia Partnership agreement on hold.

The conciliatory approach of Silvio Berlusconi, the Italian Prime Minister, was backed by Denmark, Finland, Spain, Portugal, Hungary and Bulgaria, many of which are dependent on Russian energy supplies.

The EU issued a strongly worded condemnation of Russian aggression, pledged to send observers to report on the humanitarian situation and to organise a donor conference to raise funds for Georgian reconstruction.

Mr Brown said that the EU was united in condemning the aggression of Russia. He added: “While we do want good relations with Russia, I think it is pretty clear from what has happened over these last few weeks it cannot be business as usual.”

Mr Brown secured a reference in the EU statement that it should increase efforts to diversify energy sources to reduce reliance on Russia.

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