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CBI Director General Digby Jones
"Surely a deal can be done"
 real 28k

Tuesday, 6 June, 2000, 11:35 GMT 12:35 UK
Trade sanctions threat to UK exporters
Cashmere sweaters could be the latest target
Cashmere sweaters could be the latest target
UK exporters to the United States face a renewed threat of punitive tariffs as the US steps up its campaign to force the EU to accept hormone-treated beef.

The EU has banned US beef exports, which it says could increase the risk of cancer if treated with certain growth hormones.

Last year, the EU lost its case in the World Trade Organisation, but it refused to change its stance, arguing that more scientific research is needed.

The WTO then gave the US the right to impose punitive, 100% tariffs on $116m worth of EU goods.

Now the US wants to change the list of goods subject to punitive tariffs periodically, hitting a wider range of products.

The enhanced list of sanctions would also be applied to another trade dispute with the EU, involving the preferential import of bananas from the Caribbean, which has also been ruled illegal by the WTO.

Sweaters and cheese

Cashmere sweaters from Scotland are among the products that could be targeted, potentially causing massive job losses among workers in the Border regions.

The wide-ranging lists also contain products such as cheese, candles and bacon.

Now Digby Jones, the director general of the Confederation of British Industry, has visited the US to try and mediate the dispute.

He told the BBC that it was urgent that the EU and the US sort out their trade disputes so that business could get on the with job of winning exports.

He said that while there was some sympathy with the UK, which has urged the EU to abide by the WTO decision, there was little hope that the legislation would be repealed.

Mr Jones argued that there was a possible compromise, with the US making concessions on the taxation of foreign earnings by its companies in return for more flexibility on the beef issue.

But neither side seems ready for a compromise, despite high-level talks during President Clinton's recent visit to Europe.

If anything, trade disputes between the EU and the US appear to be escalating.

Recent figures from the World Trade Organisation show that nearly 60% of all disputes since 1995 involved a complaint from either the US or the EU, the two largest trade blocs in the 134 member organisation.

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See also:

30 May 00 | Business
Trade disputes mar Clinton visit
25 Feb 00 | Business
WTO slams US trade subsidy
25 Dec 99 | Business
Body blow for free trade
18 May 99 | The Economy
Banana war exposes old trade divisions
24 Nov 99 | Battle for Free Trade
Policing world trade
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