The European Commission yesterday sent member-states a list of US goods it may hit with around $2 billion (€2.3 billion) of trade sanctions in a row with Washington over steel.
President George W. Bush has infuriated the EU by setting tariffs of up to 30 per cent on steel from Europe, Asia and Latin America, to help struggling US steel producers. The EU has said it will retaliate against US goods if Washington fails to compensate it by reducing import duties on other items. The EU also intends to launch protective measures to protect its own steel-makers.
"The Commission has today provided member-states with what it considers would be an appropriate list to be submitted to the WTO in order to protect our rights in the future to be able to impose counter measures on the United States over steel," said Commission spokesman Mr Anthony Gooch.
He declined to give further details, but an EU source said the list included steel, textiles, citrus products and items such as paper, rice and motorcycles.
The source said the list was a detailed breakdown of each item to be hit by tariffs ranging from 30 per cent to 10 per cent. This would be roughly in line with the US steel duties announced by Bush of up to 30 per cent.
EU member-states will look at the list and decide whether to back it or drop items.
A Wall Street Journal report said EU retaliation would target goods from states which are politically sensitive for President George W. Bush, such as Florida, Wisconsin, Pennsylvania and West Virginia, where Bush battled for his victory by a razor-thin margin in the 2000 election.
The list could include Harley Davidson motor bikes and orange juice. The newspaper said the strategy was to get the White House to change course on the steel tariffs by hurting regions and companies the Bush administration needs politically.
While refusing to comment on any political motive, Mr Gooch said the United States had used such tactics in past disputes with the EU over bananas and hormone-treated beef. It had targeted French cheese and wine because Paris was seen as driving European protectionism.
