Clegg Hits Back In War Of Words With France

Deputy Prime Minister Nick Clegg has hit back at attacks by the French government on the state of the British economy amid mounting tensions over the eurozone crisis.

He said comments by French Prime Minister Francois Fillon - the latest in a series of critical remarks - were "simply unacceptable".

Credit rating agency Fitch affirmed France's AAA status, but revised its long-term outlook to negative.

Rumours had been circulating that the country was facing the imminent possibility of a downgrade by rival agency Standard & Poor's .

Prime Minister Fillon and the head of the central bank, Christian Noyer , both suggested Britain should face a similar threat because it has a higher deficit, more debt and economic growth below the EU average .

He rang Mr Clegg to insist he had not intended to call into question the UK's credit rating.

Downing Street resisted any direct retaliation but Mr Clegg reacted furiously in his conversation with Mr Fillon.

A spokesman said: ""Fillon made clear it had not been his intention to call into question the UK's rating but to highlight that ratings agencies appeared more focused on economic governance than deficit levels.

"The Deputy Prime Minister accepted his explanation but made the point that recent remarks from members of the French government about the UK economy were simply unacceptable and that steps should be taken to calm the rhetoric.

"PM Fillon agreed and they both undertook to speak again shortly to discuss economic co-operation."

The row broke out following Prime Minister David Cameron's decision to veto a pan-EU treaty to deal with the crisis in the single currency.

Earlier finance minister Francois Baroin also joined the fray with an interview on French radio station Europe 1.

"It's true the economic situation of the UK is very worrying and one prefers to be French than British in terms of the economy at the moment," he said in remarks which the British Government is bound to view as inflammatory.

So what's prompted this "froideur" in the "entente cordiale"?

Could it have been London mayor Boris Johnson's message to President Sarkozy to "let them eat cake," a reference to Marie Antoinette's dismissal of the economic deprivations suffered by her subjects?

Or was it the profoundly more robust eurosceptic chest-thumping in the Commons with demands that the Prime Minister show some 'bulldog spirit' at last week's summit?

It may well have been last month's assertion by Chancellor George Osborne that France be lumped together with Italy in a group of countries the rest of Europe should be worried about.

But it's more likely to be a calculated political decision by the French government to attempt two things: prevent the downgrade (which may be too late) or an exercise in "legerdemain" - sleight of hand - in domestic politics.

France and Germany have fundamental differences over the shape of this "fiscal compact" (Paris doesn't want to surrender too much sovereignty before an election), and now other countries are starting to express their reservations about the levels of centralisation which may be on the table.

A manufactured row in which the UK is singled out as somehow receiving preferential treatment while trying to hold up attempts to negotiate a treaty or siphon more money to the IMF, both of which are designed to stabilise the single currency, will be red meat to the French right.

On the face of it, the UK can hardly boast its economy is much healthier than France's, but it has a distinct advantage in its position outside the eurozone.

The Bank of England can respond by pulling monetary levers, such as quantitative easing, to shield the UK from the economic tsunami.

France, as part of the single currency, has its hands tied.