international campaign against tax havens and money laundering, but the White House's top economic adviser said Washington was as keen as anyone to fight "hot money''.

France said it and many other industrialised nations were worried that a recent change of heart by the administration of President George W. Bush could torpedo coordinated attempts to make what they call "harmful'' tax havens respect international standards. The warning from a French Foreign Ministry spokesman came as top US trade and economic envoys met their counterparts from the 30 countries of the Organisation for Economic Co-operation and Development (OECD) in Paris.

The OECD has been coordinating a crusade that led to the publication of a blacklist of 35 "harmful'' tax havens last year -- many of them exotic islands with sophisticated offshore banking centres -- and a threat of possible sanctions. "France is particularly strongly attached to the work of the OECD to combat damaging tax practices,'' a French Foreign Ministry spokesman told reporters. "Given what we know at this stage about the US position, we want to clearly flag that unity among OECD members is vital to combating financial malpractices.'' Bush's chief economic adviser, Glenn Hubbard, said recent declarations from Treasury Secretary Paul O'Neill had been misconstrued, although he declined to say the OECD strategy could count on continued US backing.

The previous administration in Washington supported and even spearheaded the OECD work as well as similar attempts to use blacklists to ensure better surveillance and policing standards in banking centres popular among those seeking to launder hot money from crime and drugs.

But the current US Treasury Secretary said in a newspaper article last week that Washington was not convinced by the OECD's strategy and was worried that it could be misconstrued as an attempt to make low-tax regions raise their taxation levels.

Hubbard told reporters at OECD headquarters that US policy was still under review but that Washington wanted to make sure there was no attempt to discourage tax competition around the world. "Going back to O'Neill's remarks, I think he stated quite clearly that the US doesn't really see strong interest in stifling tax competition per se,'' he said.

"I think the interpretation that is most accurate of his remarks is simply that the focus should be on tax evasion and information sharing, not on tax competition per se,'' he said.

"I don't think the secretary (O'Neill) intended or said that he thought the OECD had sinister motives in any way,'' he added.

Hubbard, however, fended off repeated questions at a news conference on whether Washington would totally back out of the OECD campaign.

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