UPDATE 1-France says rows must not hurt Turkey economic ties

(Adds energy talks, new loan)

By Selcuk Gokoluk

ANKARA, Feb 19 (Reuters) - Disputes between Ankara and Paris over Armenian genocide claims and Turkey's bid to join the European Union should not be allowed to hurt business ties, France's foreign trade minister said on Tuesday.

France's lower house of parliament infuriated the Turks in 2006 by backing a bill that would make it a crime to deny that mass killings of Armenians by Ottoman Turks during World War One amounted to genocide. France's Senate never ratified the bill.

French President Nicolas Sarkozy has also upset Turkey by opposing the large Muslim but secular nation's EU entry bid.

"It is true that political disputes have affected economic decisions ... but (business) decisions should be taken on economic grounds," Herve Novelli said after signing an 80 million euro ($117.8 million) credit deal between Turkey's Halkbank HALKB.IS and the French Development Agency.

Ankara has opposed Gaz de France's GAZ.PA involvement in a natural gas pipeline project because of the genocide bill.

Last week, the European Union's coordinator for the proposed Nabucco pipeline said during a visit to Ankara that Gaz de France should not be excluded from the project, which aims to carry Caspian gas to Europe via Turkey and the Balkans.

But Energy Minister Hilmi Guler described Nabucco as a done deal and noted that its partners had agreed on Germany's RWE (RWEG.DE: Quote, Profile, Research) as the sixth partner, eliminating Gaz de France.