The European Commission today armed itself with sanctions in a long-running trade row with the United States, but backed a softly-softly approach to imposing penalties on up to $4 billion of goods.
A spokeswoman said the EU executive approved a proposal to launch sanctions gradually from March 2004, with an introductory tariff of five per cent. This is to increase by one per cent a month for a year, by which time the EU hopes Washington will have repealed the tax laws which sparked the sanctions.
The Commission is gearing up to slap sanctions on another $2.2 billion of US goods as early as December in a separate dispute over steel import tariffs imposed by President George W. Bush in March 2002.