EU could hit back at U.S. over steel 'within three months' -- WSJ

EU could hit back at U.S. over steel 'within three months' -- WSJ

Agence France-Presse Brussels

The European Union could start "within three months" to retaliate against U.S. tariffs on steel imports, the Wall Street Journal reported Wednesday.

In its European edition, the U.S. financial newspaper said the EU's retaliatory measures -- worth 341.1 million euros (US$300 million) -- would mainly focus on U.S. steel exports to Europe.

EU Trade Commission Pascal Lamy had previously said that he was considering sanctions worth $2.1 billion, but not before a year has passed to allow the World Trade Organization (WTO) to review the dispute.

"By moving up the date, the EU wants to apply some pressure on Washington before November congressional elections" and to create a global alliance of nations opposed to the U.S. tariffs, the Journal said.

More sanctions could follow in the second half of 2002, after an expected WTO ruling on the legality of the Bush administration's decision to slap tariffs of up to 30 percent on most steel imports.

Washington says the tariffs are necessary to protect the ailing U.S. steel industry and jobs, but the Europeans say the unilateral action -- which exempts Canada and Mexico -- breaks international trade laws.

In Brussels, a European official told AFP that a list of U.S. products that could be targeted by EU retaliatory measures was still being drawn up.

"One of the possibilities includes a smaller list that could be implemented before the middle of June," the official said.

Last month Lamy gave the 15 EU member states a list of U.S. products -- reportedly ranging from orange juice to Harley- Davidson motorcycles -- that could be singled out for retaliatory tariffs.

But some nations, notably Britain and Germany, are understood to have expressed reservations about the list, which observers believe was designed to target politically sensitive parts of the United States.