"Interested countries like Iran could in this way obtain nuclear fuel for civilian use under strict control," Steinmeier told the daily Handelsblatt in an advance extract of its Monday edition newspaper.

"It could be financed by countries that claim the right to buy nuclear fuel," he added.

"We need to have an international supply of nuclear fuel to stop countries feeling the need to build their own installations."

Steinmeier said the Vienna-based IAEA had the right to build and run nuclear installations.

According to the Handelsblatt, IAEA chief Mohamed ElBaradei has been informed of the proposal and Germany is planning to promote it when the country takes over the rotating presidency of the European Union in January 2007.

In a bid to resolve the standoff over Iran's suspect nuclear actitivities, Russia has offered to provide the Islamic Republic with enriched uranium.

Tehran, which denies Western allegations that it is seeking to produce nuclear weapons, has turned down the offer and violated a UN deadline to stop enriching uranium by the end of August.

The IAEA starts a general conference on Monday that will be dominated by the Iranian crisis and will consider a proposal, backed by Russia and the United States, for an international fuel bank.

"I want to make sure that every country that is a bona fide user of nuclear energy and that is fulfilling its non-proliferation obligations is getting fuel," ElBaradei said at the weekend.

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