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Tuesday, March 23, 1999 Published at 01:24 GMT

Business: The Economy

Banana war spreads to beef

The US says hormone-treated beef is safe

BBC News' Rory Cellan-Jones: Now UK jam producers could be in a jam
The US has announced a new list of European goods worth nearly $1bn that could face sanctions as part of a worsening dispute over American beef exports.

The move is in response to the European Union's continuing refusal to allow the import of American beef treated with growth hormones. The UK Government adheres to the ban but believes it should be dropped.

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A similar dispute over EU banana imports has already led to £300m ($500m) in punitive duties on a wide range of mainly luxury European goods sold to the US.

The new targets are mostly European farm products, including ham, Roquefort cheese and truffles but also extends to flowers, glue and motor cycles.

The threatened measures would double their price on American markets. However, the list is only a provisional one to be cut down to a final list of around $300m worth of exports if the US decides to go ahead with sanctions in May.

BBC News' Patrick O'Connell reports from the US
Europe has been refusing to import beef from the United States that has been treated with six specific hormones. Even though a world trade-disputes panel has ruled against the European position, the ban on such beef has remained. A deadline of 13 May has been set for the EU to lift the ban.

UK opposes ban

Trade Minister Brian Wilson and Terry Lee of the Meat and Livestock Commission react to the US move
Trade Minister Brian Wilson told BBC Radio 4: "Britain has always taken the view that the scientific evidence is not adequate ... and has been critical of the EU for taking so long to (reconsider its evidence)."

However, he said the UK would not defy the EU position and unilaterally drop the ban.

Terry Lee, head of exports at the Meat and Livestock Commission, said that in Britain the possible losses amount to 4,000 tonnes of pork worth £8m.

BBC North America correspondent Richard Quest says the sanction list bears little connection to the beef industry and has been designed to cause as much pain in Europe as possible and force the EU to the bargaining table.

The two sides have been talking about some form of compromise. There is a proposal to compensate the US for losses during any transitional period and to allow for the labelling of US beef when it's sold in Europe.

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