BRUSSELS (AFP) - British Prime Minister David Cameron urged his European counterparts at a Brussels summit on Thursday to reach a "credible" deal to keep his country from crashing out of the EU and settle the issue for a generation.
A source in his Downing Street office warned it "could be a long night" as Cameron pushed for reforms to Britain's relationship with the 28-nation bloc in the face of concerns from France and eastern European countries.
In his first face-to-face meeting with fellow leaders at the crunch summit, Cameron said there was "an opportunity to move to a fundamentally different approach to our relationship with the EU - what some might call a sort of live and let live".
He urged them to secure "a package that is credible with the British people", adding that the issue of Britain's place in Europe "has been allowed to fester for too long" and that there was now a chance "to settle this issue for a generation".
Three years after Cameron announced he wanted to reset Britain's ties with the European Union, talks are going down to the wire on his demands in four key areas.
The British premier wants restrictions on welfare payments to EU migrants in a bid to curb immigration, safeguards for non-euro countries like Britain, increased EU competitiveness and an opt-out from closer EU integration.
French President Francois Hollande said he wanted an agreement and that it was "possible" - but raised fresh doubts that countries like Britain which do not use the euro currency could secure special protections.
"No country can have the right to veto, we cannot hold Europe back from advancing," Hollande said.
The issue raises particularly sensitive questions around banking regulation as Britain is home to the City of London, one of the world's leading financial centres.
Cameron won crucial backing Wednesday from German Chancellor Angela Merkel, who said Berlin had shared his concerns "for many years".
Arriving for the summit, Merkel said there were still issues to resolve but she was "happy to do everything to create the conditions for Britain to remain part of the European Union."
For her part, straight-talking Lithuanian President Dalia Grybauskaite punctured some of the summit rhetoric.
"I think everyone will have their own little drama and then we will agree," she said.
European Commission chief Jean-Claude Juncker said he was "quite confident" of a deal, but EU president Donald Tusk warned it was a "make or break summit".
Cameron, under pressure from eurosceptics in his centre-right Conservative Party and a hostile right-wing press, says he will back a 'Yes' vote in a referendum expected this June if he can cut a deal in Brussels.
Failing that, he has said all options are open, refusing to rule out the possibility that Britain could become the first country to leave the EU in its more than 60-year history.
A leaked draft of the summit conclusions seen Thursday had a number of key passages in brackets, including on safeguards for non-euro Britain and on migrant benefits, meaning they have not been agreed despite weeks of tense negotiations.
Brussels has offered an "emergency brake" to limit benefits for new migrants for four years, which Britain could invoke if its welfare system is overwhelmed by the inflow of workers, as it believes it has been.
But Poland and other eastern European member states who have hundreds of thousands of citizens in Britain bitterly oppose such a change, saying it would discriminate against them and undermine the EU's core principle of freedom of movement.
Polish Prime Minister Beata Szydlo said on her arrival: "We want a good agreement but not at any price."
Cameron is expected to meet key eastern European states after the summit dinner on Thursday, with any deal unlikely until the next and final session on Britain due on Friday morning.
He has staked his political reputation on winning the referendum in the hope of ending a feud over Britain's place in the EU that has plagued his Conservative Party for decades.
Britons voted overwhelmingly in favour of staying in the EU in a 1975 referendum, just two years after joining.
Recent opinion polls suggest a narrow lead for those who want to stay in the EU but there does seem to have been a modest increase in the 'No' camp. Many voters are thought to be undecided.