German Chancellor Gerhard Schroeder has said Germany should liberalise laws that restrict researchers' use of embryonic stem cells.
Germany cannot afford to 'fall behind' other nations
Mr Schroeder says his country cannot afford to fall behind other nations.
His comments came after Italy's failed referendum on relaxing strict fertility and bioethics laws. Not enough people voted after Vatican calls to stay away.
Germany bans the creation of embryo cells purely for research, but allows human embryo stem cells to be imported.
STEM CELL MILESTONES
1960s: Research begins on stem cells taken from adult tissue
1968: Adult stem cells used to treat immune deficient patient
1998: US scientists grow stem cells from human embryos and germ cells, establishing cell lines still in use today
2001: Embryonic stem cell turned into a blood cell
2004: South Korean scientists clone 30 human embryos and develop them over several days
2005: Korean team develops stem cells tailored to match individual patients
A survey cited by German broadcaster Deutsche Welle says just over 40% of Germans are in favour of easing restrictions on stem cell research.
Almost a third told the Wahlen research group they opposed loosening the legislation, while the rest were undecided.
All research involving embryos was previously banned in Germany, where memories of the horrors perpetrated by Nazi scientists have made the issue particularly sensitive.
Scientists hope to use stem cells for treating such illnesses as diabetes and Parkinson's disease.
"We must not uncouple ourselves from progress in international research in biological and genetic technology," Mr Schroeder said in a speech at the University of Goettingen.
"We would then be excluded from having a say in the use and control of the procedures. Research would continue elsewhere - possibly in a way that would take practically no account of ethical considerations."
Mr Schroeder said recent developments "show how quickly we can be faced with situations that demand new discussions and decisions".
With the existing law, "we in Germany put ourselves on the side of the more restrictive countries, by European and international standards," the chancellor said.
"I am convinced that... we cannot in the long term escape the tendency toward liberalisation of research with embryonic stem cells," he added.
But opposition politicians, including the Christian Democrats (CDU), and the Social Democrat's junior coalition partner, the Greens, criticised the chancellor's comments.
"The limits of bioethics should not be sacrificed thoughtlessly," Volker Beck of the Green Party said.
"Human life deserves protection for its own sake - our constitution demands that in the name of human dignity."