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Sarkozy rhetoric over EU 'win' fuels Anglo-French war of words

French President Sarkozy tagged London a big loser after the EU appointed a French finance chief. London fears greater 'meddling' in its financial services industry.

By Correspondent / December 4, 2009

French President Nicolas Sarkozy delivers a speech on economic recovery after a visit at the industrial group CNIM (Constructions Industrielles de la Mediterranee) in La Seyne-sur-Mer




A combative cloud hung over Anglo-French relations Friday after French President Nicolas Sarkozy abandoned a London visit in which he was to calm concerns over interference in London's prized financial services sector by a new French-born EU policymaker.

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A cross-Channel spat has been brewing all week – with the British saying their supposedly "light touch" financial services industry may come under excessive Gallic-style regulation, and Sarkozy boasting that he wanted to see the "European model" triumph over "the excesses" of capitalism.

Yet despite invocations of Waterloo, Sarkozy's impolitic words, and the failure of the Friday visit to materialize, the dispute may relate more to shaping domestic political advantage ahead of elections next year in both countries than serious quarrels over guiding European Union financial policy.

The row is also being portrayed as part of French plans to try to build up Paris as a financial hub at London's expense.

" 'Sarko' is not well known for his restraint," says Giorgio Questa, a professor at London's City University, "and [Prime Minister Gordon Brown and Chancellor of the Exchequer Alistair Darling] are trying every possible populist sound-byte to avoid defeat in next year's general elections."

Sarko speaks his mind

After the reshuffle of the European Commission's "cabinet" led to Michel Barnier, a former French agriculture minister, securing the powerful internal market portfolio, the famously outspoken French president told Le Monde last weekend that "the British are the big losers in this business."

Unable to resist again on Monday, President Sarkozy told an audience in the south of France: "Do you know what it means for me to see for the first time in 50 years a French European commissioner in charge of the internal market, including financial services, including the City [of London]?"

The remarks sparked five days of headlines in Britain, customarily name-checking historic Anglo-French battles and giving voice to concern about greater European interference in London's money industry.