FRANKFURT (Reuters) - German industrial conglomerate Siemens AG plans to slash almost 17,000 jobs worldwide to speed up cost savings and boost margins as it prepares for a global economic downturn.

Chief executive Peter Loescher, who has extensively restructured Europe's biggest engineering group since taking charge a year ago, said Siemens needed to be faster, more efficient and have a leaner administration if it hoped to keep up with rivals.

"This takes on special urgency when one considers the economic downturn," he said. Siemens will cut 12,600 jobs globally mainly in administration, aiming to meet its 1.2 billion euros ($1.9 billion) savings goal and its margin targets by 2010. It plans to eliminate another 4,150 jobs through restructuring programmes.

Negotiations with labour representatives about the planned job reductions will begin quickly, Mr. Loescher said.

Engineering trade union IG Metall condemned the plans and did not rule out taking measures in protest.

"Siemens is looking good economically, the order books are full...That makes the planned job cuts neither comprehensible nor acceptable, and they are excessive in extent," said Werner Neugebauer, head of IG Metall in Siemens home state of Bavaria.

Labour representatives planned to resist but would first wait for the outcome of negotiations with management.