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E.U. Threatens Trade Bar as Russia Crisis Deepens

By BRUNO WATERFIELD, The Daily Telegraph | May 4, 2007

BRUSSELS, Belgium — The European Union is threatening to block Russian membership of global free trade agreements unless President Putin pledges to "de-escalate" a deepening crisis between Moscow and its neighbors.

Secret E.U. documents show that patience in Europe is running out with Russia amid spiraling trade disputes and attacks this week on Estonian diplomats in Moscow.

NATO joined the E.U. Thursday in registering a formal diplomatic protest over Russia's failure to protect Estonian embassy staff from marauding demonstrators with close political links to Mr. Putin.

Estonia and Russia are at each other's throats over violent protests following the relocation of a Soviet war memorial in Tallinn, the Baltic state's capital.

Sergei Lavrov, the Russian foreign minister, has fanned the flames by saying that moving the Red Army monument had "led to seriously negative consequences for Russian-Estonian relations."

The row has been escalated by a Russian rail blockade of oil and coal exports to Estonia, a development that will harden E.U. resolve to take a tough line on Moscow's ambition to membership of the World Trade Organization.

The showdown will take place at an E.U.-Russia summit in the Russian city of Samara on May 18 and European diplomats are ready to read the riot act to Mr. Putin over a growing number of disputes.

These include cuts to Lithuania's oil supply, dual pricing for international and domestic rail cargo, export duties on wood, and a ban on Polish meat imports.

WTO membership is key to Russia's full participation in the international economy and to securing lucrative, investment-friendly trade deals with the E.U. and America. A bullet point on a secret negotiating memo seen by the Brussels newspaper European Voice says: "Make clear that E.U. is ready to support early conclusion of Russia's WTO accession but not at any price and bilateral problems or disregard for existing commitments will be major impediments.


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