The Naples Summit: G7 aid urged to halt North African exodus: France and Italy demand action to counter economic hardship and the murderous onslaught by Islamic fundamentalists

THE spectre of mounting violence in north Africa prompting a mass exodus to Europe forced its way high on to the agenda of the World Economic summit yesterday. After the knifing to death of seven Italian sailors in Algeria on Thursday, the leaders of Italy and France demanded that the rest of the world's richest democracies take action to stabilise the region.

Silvio Berlusconi, the Italian Prime Minister, told President Bill Clinton in a private meeting that the situation in Algeria had become intolerable. President Francois Mitterrand of France, which has just renewed a pounds 600m credit line to Algeria to support the government against the fundamentalist forces, said he would demand that the other leaders make sizeable contributions.

President Clinton told Mr Berlusconi that the best recipe for stabilisation was for the Algerian government to not only open a dialogue with the fundamentalists, but to include some of their representatives in the cabinet. Mr Berlusconi said this was impossible as President Mitterrand was against any co-operation with the Islamic movement.

The European Union was preparing to announce a 350m ECU (pounds 449) balance of payments loan to Algeria, which claims it is facing its worst drought in 50 years. Oil and gas revenues are falling, bread prices have been raised to meet IMF demands. Further hardship is bound to heighten fundamentalist sentiment.

The differing perception of how to deal with the Islamists - whether to have a dialogue or to adopt a zero-tolerance policy - lies at the heart of a dilemma faced by every country in the region. Tunisia has curbed its fundamentalists reasonably effectively by adopting the latter approach, while Egypt is accused of having the problems it has today because it let dialogue go too far.

The French and German governments have recently highlighted the fear of a mass influx from the Maghreb to northern Europe. Bonn is seeking to persuade the German taxpayers that the Mediterranean region is as much a frontline for Europe as is Germany's former Warsaw Pact neighbours. And advisers to Chancellor Helmut Kohl pointed out that there were more illegal immigrants from the Maghreb caught on the Polish-German border than there were Romanians.

Mr Clinton, who sees Algeria as a test case for dealing with fundamentalism worldwide, appeared adamant yesterdy that some fundamentalists must be included in government. 'I still hope to help it find ways to accommodate legitimate forces of dissent . . . so that a democratic or at least functioning government could exist,' he said. It was 'a troubling thing' that unrest was mounting in such 'a strategic area'.

France, which as Algeria's past colonial master harbours the biggest Algerian diaspora, is anxious not to let the issue become a crisis before next spring's presidential election. President Mitterrand's sherpa, Anne Lauverjeon, said: 'We are going to talk about Algeria in terms of showing that this is an issue of the first order for us.'

The French point out that Mr Clinton's knowledge of the Maghreb is limited, and are irritated at what they see as his repeated interference, coupled with a refusal to contribute sizeable funds for aid.

The particularly brutal slaughter of the seven sailors - they were tied up on board and had their throats slit - has become an unexpectedly live issue at a summit where subjects are normally agreed months in advance. Several of the victims were from Naples, and the front pages of the Italian press yesterday had room for little else.

(Photograph omitted)