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With Marine Le Pen chasing his votes, the French president has made labelling of halal meat an election issue. But Muslim entrepreneurs are dismayed by his shift to the right

France, Paris - Les Enfants Terribles, a chic restaurant in Paris's 12th arrondissement, was packed. Plates of halal foie gras à la maison, halal braised lamb with rosemary, and halal caramelised duck were being dispatched to tables. Fresh fruit cocktails and exotic non-alcoholic concoctions replaced glasses of wine.

Mohamed Abdenebi, 36, a history and geography teacher, was a typical diner: young, French, Muslim, dynamic - and furious. According to Abdenebi, France has let its Muslim population down. "They said to us, 'Do your studies, and you will get a job.' We did our studies but there were no jobs and they said we hadn't done the right studies. Each time there was a new obstacle."

Instead of being integrated and treated with equality, Abdenebi says the halal row shows the extent to which France's Muslims are being made to feel like "the enemy within".

Similar complaints were being heard across France. President Nicolas Sarkozy's decision to make the labelling of halal meat pivotal to his re-election campaign has infuriated, alienated and dismayed France's Muslim community, which may number as many as six million, and the backlash is growing. Members of the booming educated and entrepreneurial Muslim middle class say they are tired of being cast as scapegoats in Sarkozy's wooing of the extreme right and have accused him of dangerous and divisive election tactics.

Fateh Kimouche, a high-profile Muslim blogger, said the new class of second- and third-generation Muslims in France was not prepared to lie down and let the French republic roll over it as their parents had done.

"My parents came from Algeria and, like many others, they didn't make a fuss because they felt like invited guests who had to be on their best behaviour. But I was born here. We are Muslims and we are French, but every day we are attacked, insulted and treated like terrorists or extraterrestrials," he said. "France educated us; we have energy and enthusiasm and we have brains, businesses and money. The old generation of politicians don't seem to realise this."

The phoney war over halal meat erupted in February when Marine Le Pen, leader of the far-right Front National, claimed consumers were eating halal unknowingly. Sarkozy, trailing the Socialist frontrunner François Hollande, accused her of whipping up an artificial controversy. Shortly afterwards, with Le Pen snapping at his heels in the opinion polls, Sarkozy performed a volte-face. In spite of surveys showing that voters were less concerned about halal meat than they were about the weather and football, he announced it was "the issue that most preoccupies the French".

For France's Muslims - already feeling victimised by a burqa ban, by controversial government-sponsored debates on national identity and by the outlawing of Muslims praying in the streets, a sight Le Pen likened to the Nazi occupation - it was a low blow.

Few believed that the halal uproar had anything to do with how animals are slaughtered or who eats them. "It's a blatant attempt to divert attention away from the real problems," said Yanis Bouarbi, founder of the successful restaurant website paris-halal.com. "You can have a debate about how animals are killed, but this is pure electioneering."

Kimouche, 36, who has a degree in political philosophy, worked as a publisher's proofreader before he spotted the untapped business potential in France's nascent Muslim middle class. He left his job and started a profitable blog, al-Kanz, which covers all aspects of Muslim life and rituals, and boasts up to 10,000 visitors a day.

"Nicolas Sarkozy and Marine Le Pen have resorted to this because they have no solutions to the real problems. It's the last desperate thrashings of a mad dog that has nothing to lose," he said. "It's part of a chain of thought that goes from halal meat to Islamism to terrorism."

As he talks, Kimouche finds it hard to hide his anger and frustration at what he sees as a "violent and populist" presidential campaign. "Really, we might have hoped for better from our politicians. I am a French Muslim, I love France, but I want to leave this country. Every day we are being attacked and insulted and we have had enough."

In alienating Muslims such as Kimouche and Bouarbi, Sarkozy is ignoring the spending power - the halal market, for example, is growing at 20% a year more than organic food - of a socio-economic group that might otherwise have been tempted to vote for his business-friendly, free-market agenda.

Kimouche points out that there is not one Muslim MP in the French parliament. "In France, they say there are no communities within the republic, everyone is the same. But this is not true. No matter what we do, no matter how hard we try, we are seen as a fifth column, the enemy within, a threat, a menace."

France has failed to learn the lesson of its history, says Abdenebi: "In 1939 when there was an economic crisis, the enemy was the Jews. Today there is a crisis and it is the Muslims. It's the same discrimination, just a different community."

Kamel Saidi, 34, the softly spoken owner of Les Enfants Terribles, says he finds the political atmosphere "revolting and tiring". And he cannot see the situation improving. "People feel afraid because today the party of the right is adopting the ideas of the extreme right. What's even more worrying is that this attitude is not going to change, certainly not in the near future.

"It is depressing that all we are trying to do is find our place in society, and there is no recognition of this, just suspicion. Once again, it's as if the whole Muslim community is suspect."

Abdenebi is slightly less pessimistic: "There is hope for change, but I don't see it happening for at least 50 years... maybe 100."