NOTES: What big consultancy fees you have!


French President Nicolas Paul Stéphane Sarközy de Nagy-Bocsa – you may want simply to call him Sarko – made waves at the end of January when he attempted to justify a 1.6% rise in the VAT rate.

According to a report in the British newspaper, The Telegraph, a journalist pointed out to Sarko that in Britain price increases had followed hot on the heels of an increase in the VAT rate.

Sarko’s dismissive retort: “The United Kingdom has no industry any more.”

This, in turn, aroused the indignation of an unidentified senior British civil servant who countered, “In the UK the percentage of GDP that is manufacturing is 11%, the same as in France. UK industrial production as a share of GDP was 15%, compared to 12.5% in France in the same year. What the French president said is not true. He has got an election.”

The 108-year-old Entente Cordiale, the diplomatic bond of friendship between the two nations, was stirred but not shaken. (France’s presidential elections will be conducted over two days, between 22 April and 6 May this year.)

What The Telegraph report did not point out is that a significant part of the relic of industry left in both countries is made up of the arms industry – which is carefully nurtured and cosseted by both French and British politicians alike.

The Entente took even more strain recently when the time came for the Indian government to decide from whom it would buy a bunch of new fighter jets.

India is the recipient of four annual £280-million (R3.38 billion) grants-in-aid from Britain – and four concurrent grants of only £18.5m (R224.8m) from France, so the Brits were rather relying on the outcome of the contest being a foregone conclusion. Hence a certain measure of public outrage when the Indians announced that they had decided against Britain’s Typhoon Eurofighter and would rather go with the Rafale fighter jet manufactured by France’s Dassault Aviation – for no less than £11bn (R133bn).

There has been a question mark hanging over the future of the Rafale but if this contract is signed and sealed its future is assured. That will also be a massive shot-in-the-arm for the French economy – and for Sarko.  

British outrage was further fanned by India’s Minister of Finance, Pranab Mukherjee, who proceeded to dismiss British aid as “an unwanted peanut” in the greater scheme of India’s development spending.

He and other cabinet ministers had tried on numerous occasions to tell Britain that, although they were the world’s biggest recipients of Britain’s largesse, in fact, they had a booming economy, experiencing economic growth rates of up to 10% each year. India will very soon have a bigger economy than that of their biggest benefactor.

Clearly there are no kindly rich uncles among the armaments-producing nations. But it is nice, once in a while, to see one of them getting stung. Even if it is only a question of the French having paid the bigger, er... consultancy fees.

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