The union bosses were joined at the prime minister's home in Downing Street by workers from the Scottish cashmere industry whose jobs are particularly vulnerable.

Liberal Democrat leader Paddy Ashdown also confronted the US trade ambassador to the World Trade Organisation over the trade row.

Mr Ashdown flew to Geneva and told Rita Hayes that jobs in the Scottish Borders cashmere industry were at risk and a trade war had to be stopped.

The US has imposed huge import costs on a variety of products from the European Union in retaliation for what it says is unfair banana trading.

It was in 1993 that the US began accusing the EU of giving former European colonies in the Caribbean preferential treatment in the banana trade, penalising American companies growing the fruit in Latin American.

The dispute is now before the World Trade Organisation which has recently delayed a ruling on the matter. The EU denies any unfairness over banana imports.

Morris men

Several thousand jobs could go among workers in the Scottish cashmere industry.

The decimation of order books, thanks to the high import costs, will mean depressed times too for the border towns where many of the cashmere trading companies are based.

General Secretary of the Transport and General Workers' Union, Bill Morris, said: "We don't believe that what America is doing represents free or fair trade.

"Our members in Scotland are facing the possibility of losing their jobs over this."

US ambassador Philip Lader emerges from the Foreign Office

The UK Government has already singled out the cashmere industry for special aid, in the form of underwriting US import costs.

The UK Government is issuing certificates to US customs so that if the banana dispute is settled in favour of Washington, the Treasury will settle the bill.

Mr Morris has written to leading supermarket chains asking them to clearly label where their bananas were grown, so British customers can make a choice about whether to buy Caribbean or Latin American ones.

Tough action

The US has imposed 100% tariffs, effectively, on a range of EU products, a move which has been condemned by many members of the WTO.

Bonds need to be bought to the full value of specific goods entering the US market.

Despite widespread alarm, the US has so far remained steadfast in its approach.

The row has even involved the unprecedented step of the UK Government summoning the US ambassador to London for urgent talks on two occasions.

EU officials have warned that if the Caribbean farmers lose their markets they may turn to growing illegal drugs.