BERLIN, Feb 25: European Union states must stop defending their national companies from foreign takeovers, Italian Economy Minister Giulio Tremonti said on Saturday, warning of dire consequences if protectionism went unchecked.

“We still have time to stop European Union states from building national barriers. If not, we risk the impact of August 1914,” Tremonti said, referring to the start of World War One.

“No-one wanted war then. Today, no-one wants a total block of the European market,” he told reporters during a trip to Germany.

The Italian minister was speaking on the day the French government gave its blessing to a merger of state-controlled Gaz de France and private French utility group Suez to fend off a bid for Suez by Italy’s Enel.

Such a merger would undoubtedly put a severe strain on relations between Rome and Paris, coming just a year after the Italian government allowed Gaz de France to take over Italy’s second biggest power group Edison.

Italian Prime Minister Silvio Berlusconi said on Thursday Enel should be afforded equal treatment in its push into France.—Reuters