Array of Prickly Issues Awaits Bush in Europe

WASHINGTON (Reuters) - President Bush takes an unusually wide and prickly agenda with him to Europe this week,
ranging from missiles to trade, pollution to hormone-treated beef. U.S. commitment to a missile defense system, and U.S.
rejection of the Kyoto global warming pact, are the main points of friction between Washington and its European allies.

The affable Bush, a conservative Republican with little international background who has made several policy stumbles
in his first five months in power, will meet NATO and European Union leaders as well as Russian President Vladimir Putin.

The main issues:


European reaction to Bush's proposal to build a defense system to protect the United States from limited long-range missile attack
has ranged from skeptical to hostile. Bush is expected to build on a charm offensive started by Secretary of State Colin Powell
and Defense Secretary Donald Rumsfeld to sell the idea. But the allies do not accept the U.S. view that the threat from North
Korea, Iraq and other states is so grave that it warrants scrapping the current complex of Cold War-era arms agreements.


NATO is due to announce expansion plans at a summit in Prague next year, but Bush is expected to discuss the issue.
Washington supports further expansion in principle, but some states are concerned that the 19-member alliance is
becoming unwieldy. Some states, in particular Germany, are reluctant to provoke Russian ire by letting in Baltic states.


Washington has expressed concern over EU plans for a 60,000-strong European rapid reaction force to be ready by 2003,
which U.S. officials fear could undermine NATO operations. Such fears appear to be abating as Europeans accept
limitations on the independence of the force from NATO.


Bush is expected to confirm statements by Rumsfeld and Powell that the United States is not contemplating an early or
unilateral withdrawal of U.S. peacekeepers from the Balkans. Such fears were prompted by remarks by Bush that he
would reduce U.S. oversees commitments where possible. The United States has 6,000 troops in Kosovo and 3,000 in Bosnia.


Bush provoked anger among Europeans by announcing his intention to abandon the 1997 Kyoto global climate warming treaty,
which would cuts in emissions of greenhouse gases. Bush, who has tried to build up an environmentally friendly image after
alienating many Americans with tough polices after he took office, was expected to soften his tone for the European trip,
especially after receiving an alarming scientific report on climate change. Washington is not expected to have an alternative
approach ready until later this summer.


Bush, who had alarmed South Korea and other states by suspending contacts with North Korea, announced on Wednesday
he would go ahead with talks aimed at reining in Pyongyang's missile sales and shore up its nuclear freeze. He is expected
to discuss his approach with the EU, which is also engaged in an initiative to help neutralize the threat of the impoverished
but well-armed Communist state.


Eighteen months after violent protests and rich-poor disputes halted attempts to start a new round of world trade talks in Seattle,
U.S. and European countries face an uphill struggle to revive the initiative. U.S. analysts do not expect much progress during the
president's trip. EU Trade Commissioner Pascal Lamy on Thursday downplayed speculation the transatlantic powers would
''launch'' the new round when Bush meets EU leaders in Sweden. But an EU official said the two sides appeared to be moving
toward a common agenda before the next WTO ministerial meeting in Doha in November.


Bush's decision to pursue possible new import restrictions on steel, posing a direct threat to EU steel producers, alarmed
Europeans. The EU has threatened to challenge the action at the World Trade Organization. Lamy decried a tendency of the
Bush administration toward ``unilateralism'' and said its decision on steel could backfire.


Despite the recent resolution of a long-time dispute over the EU's banana import licensing regime, there has been no similar
breakthrough in the 12-year-long fight over the EU's ban on beef from cattle raised with artificial hormones. Europe's problems
with livestock foot-and-mouth disease has complicated the issue by reducing European beef demand. In the meantime,
the United States maintains about $117 million in retaliatory duties on EU food products.


The EU is on the verge of setting new biotech labeling and ''traceability'' rules for foods. Two years ago, the EU placed a
moratorium on approvals of new biotech crops. That decision effectively shut down EU imports of U.S. corn, which has been
plagued by problems related to gene-spliced seeds. The EU is still debating details of its upcoming rules, including the trace levels
of unapproved genetically modified organisms that would be allowed in bulk commodity imports. The U.S. farm community is
hinting that a too restrictive rule could prompt a complaint to the World Trade Organization.

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