(Bloomberg) -- By picking a fight with France’s Emmanuel Macron, Italy’s populist leaders have cannily tapped a raw nerve among their countrymen.

Behind the broadsides fired by Matteo Salvini and Luigi Di Maio, which prompted the French president to recall his ambassador from Rome last week, is a widely held resentment among Italians at what they see as French arrogance and failure to give Italy its due in everything from diplomacy to the arts.

Bones of contention are plentiful, from the French swallowing up Italian fashion labels, to France and Germany flouting European Union deficit rules as the two biggest economies in the bloc -- but reprimanding Italy. Then there was former President Nicolas Sarkozy’s intervention in Libya, a former Italian colony.

When the French mention “grandeur,” the Italians counter with the ancient Roman empire and the Renaissance. And yes, Italians believe Leonardo Da Vinci’s Mona Lisa belongs in Italy, not France.

Berating the French by resurrecting old tropes serves an obvious political purpose. Both Salvini and Di Maio are on a permanent election footing and looking for ways to divert attention away from a battered economy.

For the corporate world, the political spat is unwelcome.

At a dinner in Paris last week, Italian bankers working for a French lender in Milan were dismissive of the row, ridiculing Salvini and the anti-immigration rhetoric of his League party. The bankers were more worried about Rome’s fractious coalition, which business leaders feel is picking fights to distract voters from yet another recession.

“Imagine how embarrassed I am,” Oscar Farinetti, founder of the Eataly high-end food chain, complained ahead of the opening of a new store in Paris in two months.

“I’ll be forced to apologize because Di Maio’s action doesn’t represent me and we can’t allow ourselves such behavior,” Farinetti told newspaper La Stampa after Di Maio triggered the ambassador’s recall by meeting leaders of the Yellow Vests protesters near Paris.

Still, some of the bitterness being stirred up strikes a chord with Italian entrepreneurs. In the fashion industry, after French conglomerates spent 20 years buying up some of Italy’s most illustrious family names like Gucci and Fendi, simply using a French word like "provocateur" can be enough to ruffle feathers.

Michel Ange

“How do the French call Michelangelo? Michel Ange - separate. What we call the Rinascimento, they call the Renaissance,” Prada’s CEO Patrizio Bertelli said in an interview with Bloomberg in September. “Why do the French have to make everything French or French-sounding?”

In practice, however, the Italians and the French work closely together in the luxury sector. France makes the perfume, Italy makes the eyewear, handbags, and shoes. Regional authorities in Tuscany, for example, welcome French groups investing in new factories there.

One French executive, who has just launched operations in Italy, said he was not having any trouble with Italian authorities. The company was started from scratch, all the staff except one was Italian, and his hosts had never shown any hostility toward him, said the executive, who requested not to be named.

Petty Things

The risk is that the bickering could descend into a tit-for-tat.

“French people could buy less Italian exports, because this is stoking up nationalism on both sides, although Macron calls it patriotism,” said Nathalie Tocci, director of the Rome-based International Affairs Institute. “Once you get into that vicious circle, you could get into petty things like consumer campaigns not to buy French, and a suspension of major decisions.”

And crucially, Italian businesses stand to lose more than French ones, according to Carlo Alberto Carnevale Maffe, a professor of business strategy at Milan’s Bocconi University.

“The political-industrial apparatus in France is more united and solid than in Italy, where the populist government and the private sector are very detached from each other,” said Carnevale Maffe. “The French can harm us by reducing credit and investment, in sectors from luxury to pharmaceuticals, and food and beverage.”

--With assistance from Geraldine Amiel, Robert Williams, Ania Nussbaum and Angelina Rascouet.

To contact the reporters on this story: John Follain in Rome at jfollain2@bloomberg.net;Gregory Viscusi in Paris at gviscusi@bloomberg.net

To contact the editors responsible for this story: Ben Sills at bsills@bloomberg.net, Flavia Krause-Jackson, Jerrold Colten

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