PARIS, Nov 13 (Reuters) - President Francois Hollande, grappling a sickly economy and dismal ratings, urged the French public on Tuesday to judge him on his long-term success in reviving the country's ailing industry and halting a 17-month rise in unemployment.
Stressing that low French bond yields showed that markets believed his economic policies were credible, Hollande said a move to fund tax rebates for companies with small rises in sales tax should bolster output while preserving consumer spending.
"Decline is not our destiny," the Socialist president told a news conference to mark his first six months in office.
"I can understand the doubts that have been expressed. The only valid question in my eyes is not the state of public opinion today but the state of France in five years' time."
Hollande said he would not be swayed from his goal of reviving the economy in two years by gloomy public opinion, as polls give him approval ratings as low as 36 percent, down from above 60 percent when he took power in May.
"The recovery will take time but I believe we can succeed. I want young people to be living better in five years' time."
Turning around France's stalled economy and closing a competitiveness gap with Germany, which is running a huge trade surplus as France sinks deeper into deficit, has become Hollande's biggest challenge.
He called on trade unions and employers to strike a "historic compromise" to reform labour contracts to boost employment, saying the government would legislate if they failed to reach a deal but he would prefer to turn an agreement reached through negotiations into law.
Prime Minister Jean-Marc Ayrault will defend the Socialist government's policies in a meeting on Thursday with German Chancellor Angela Merkel following reports that Berlin is concerned France is not doing enough to revive its economy.