Minister for Finance Brian Cowen has denied that the Government's retention of a shareholding in Aer Lingus after a public flotation is a case of "economic patriotism".

Speaking at a meeting of EU finance ministers in Vienna at the weekend, Mr Cowen also defended the Government's handling of semi-state firms and signalled that it had no "fixed ideological mantra" in relation to future privatisation and liberalisation.

Mr Cowen's comments followed presentation of a British paper to EU finance ministers urging member-states to liberalise their networks industries.

The paper, which covers electricity, post, air, telecom and rail, shows the Republic is ranked 13th out of the original 15 EU states for opening up these sectors to competition. Just Greece and Portugal have more closed economies for these sectors, it concludes.

The paper says too many industrial sectors are hiding behind barriers that reward inefficiency, and lack of competition is a problem.

It estimates that the failure to open up the gas market to competition, for example, means that Europe's energy consumers will pay an extra €57 billion this year.

To boost competition it recommends setting up an independent panel of experts to investigate protectionism, as a means of supporting the existing EU competition regime.

Reacting to questions over the Government's handling of the Aer Lingus flotation and the energy market, Mr Cowen defended its record on privatisation and liberalisation.

"It is important that we enable these companies to continue to operate in competitive environments. We have to balance the interests of consumers and all stakeholders," said Mr Cowen. "It is not a question of all public is bad and all private is good."

He rejected the notion that the Government's decision to retain a stake of at least 25.1 per cent in Aer Lingus is an example of the type of "economic patriotism" currently sweeping through Europe, particularly in the banking and energy sectors.

"You cannot say we made the decision because of patriotism; we made the decision because it was commercially the right thing to do," said Mr Cowen.

"We have strategic interests to protect and we intend using that stake as a means of helping us do that."

Mr Cowen acknowledged that there was a problem currently with attracting competitors into the Irish energy market.

However, he said that this related primarily to the small size of the domestic market, which made it very hard to attract investment.

In relation to the ongoing energy policy review - which will advise on the future of the ESB, among other things - Mr Cowen said people shouldn't adopt the view that "breaking up everything" was the only way to go forward.

"I have an open mind; I want to look at what the options are," he said.

Meanwhile, EU finance ministers warned at the meeting in Vienna about the growth of protectionism in key industrial sectors in recent months in Europe. Austrian finance minister Karl-Heinz Grasser, who chaired the meeting, blamed national barriers and protectionism for Europe's high unemployment rate.

"We need to deregulate more," Mr Grasser said.

But the British plan for a new independent panel of experts to investigate protectionism in certain sectors received a cool response from France.

"Some sectors will become critical, like agriculture, energy and water We need different rules for these sectors," said French finance minister Thierry Breton.

He said a new panel would create another needless piece of bureaucracy to oversee antitrust issues in the EU.