UPDATE 1-Merkel says EU must create jobs to counter populist wave
* Merkel says EU must win back those who voted for populists
* German leader urges focus on growth, jobs, competitiveness
* Merkel says "intensive talks" needed on top Commission job (Adds Merkel quotes, background)
By Andreas Rinke
BERLIN, May 26 (Reuters) - Germany's Angela Merkel expressed regret that populist parties had done well in EU elections and said it was up to governments in countries like France to win back voters with policies that foster growth, jobs and competitiveness.
"As for the good results of the populists and the right-wing, it's remarkable and regrettable," the chancellor told a news conference in Berlin on Monday.
"The question is how we win over voters. This is also the case for France," she said. "I think a course that focuses on competitiveness, growth and jobs is the best answer to the disappointment."
Eurosceptic parties scored major victories in France, Britain, Greece and other European Union countries on Sunday. In Germany, the anti-euro Alternative for Germany (AfD), which was founded only a year ago, won 7 percent of the vote.
Merkel said the results were unlikely to have a major impact on the functioning of institutions like the European Parliament, which will continue to be dominated by mainstream parties of the centre-right and centre-left.
"It will be more about pursuing policies that resonate with the people," said the chancellor, whose conservative bloc emerged as the strongest party grouping in Germany.
"They are less interested in the issue of whether there should be treaty change or not, but rather whether Europe is making a difference in their own lives," she added, noting that high jobless rates in some countries had damaged trust in the EU project.
Standing alongside Merkel, David McAllister, who led the campaign for Merkel's Christian Democrats in Germany, offered strong backing for Jean-Claude Juncker as the next president of the European Commission, calling him a "convinced and convincing European".
But Merkel was more cautious, praising the former Luxembourg prime minister for his campaign as lead candidate for the centre-right European People's Party (EPP) but also making clear that extensive talks would be needed to finalise the top Commission job.
Preliminary results showed the EPP winning 214 seats, compared to 189 for the second-place Socialists. That still leaves the EPP well shy of the 376 seats needed to secure a majority in the 751-member parliament.
"We are going into the debate with Jean-Claude Juncker as our candidate," said Merkel. "The main issue is which group came out stronger. But we also know that none of the two big groups can decide the European Commission president on their own. So we need intensive talks and those haven't even started yet."
At a separate news conference, the head of the German Social Democrats Sigmar Gabriel signalled that his party was not ready to concede defeat in the battle for the top Commission job.
In an apparent attempt to shift the balance towards the Socialists and their lead candidate Martin Schulz, he called on the EPP to end its cooperation with Hungary's ruling Fidesz party and Italy's Forza Italia - led respectively by controversial figures Viktor Orban and Silvio Berlusconi.
"I think it is wrong to make the fate of the European Union dependent on these two parties," said Gabriel. (Reporting by Andreas Rinke, Stephen Brown and Erik Kirschbaum. Writing by Noah Barkin, editing by Mike Peacock)
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