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27 Jul, 2017 07:02

'Counter-sanctions possible, trade war between EU & US would be very bad' - German economy minister

'Counter-sanctions possible, trade war between EU & US would be very bad' - German economy minister

New sanctions against Russia approved by the US House of Representatives on Tuesday could result in counter-sanctions, warns the German economy minister, adding that a trade war between the EU and the US would be "very bad."

Speaking to ARD television, Brigitte Zypries warned of a trade war between the European Union and the United States.

"There is a possibility of counter-sanctions because this is envisaged by the WTO (World Trade Organization)," she said, adding that a trade war would be "very bad."

She also said that new US sanctions may harm German companies and hamper Berlin's ties with Washington.

"The US has left the common line it had with Europe for sanctions against Russia," Zypries told ARD on Thursday. She added that the lack of coordination with the EU may affect German companies.

On Wednesday, the Association of German Chambers of Commerce and Industry (DIHK) said that new sanctions against Russia may have a negative impact on Europe’s energy security and hurt the German economy, adding that they appear to favor American firms.

DIHK's chief economist of the German business lobby, Volker Treier, has urged the EU to address the issue.

“The European Commission now must make efforts to shed light on the current situation, as well as resist the exterritorial effect of new US penalties. We get the impression the US pursues their own economiс interests,” he told TASS.

“If German firms are banned from participating in gas pipeline enterprises, very important projects in the energy supply security sector can be halted. In that case, the German economy will be discernibly influenced,” Treier said.

German Foreign Ministry spokesman Martin Schaefer also told a news conference on Wednesday that the sanctions bill "concerns not only German industry...sanctions against Russia should not become a tool of industrial policy [pursued] in the US interests."

“In our opinion, it is not in the Americans’ right to judge or stipulate which way European companies may engage in cooperation with any third parties – particularly with Russian energy companies,” Schaefer said.

Speaking at the same briefing, government spokeswoman Ulrike Demmer added that Berlin believes “the European industry should not become the target of US sanctions.”

The French foreign ministry echoed the German sentiments, objecting to the law on the grounds that it affected American companies outside the United States, which it says is outside the scope of US law. In a statement the ministry warned that "[t]o protect ourselves against the extraterritorial effects of US legislation, we will have to work on adjusting our French and European laws."

Austrian Chancellor Christian Kern on Wednesday called the US measures unacceptable. "I consider the US sanctions against Russia absolutely unacceptable. Political interests should not be mixed up with the economical ones, to the detriment of employment in the European Union," Kern wrote on his Facebook page.

Italy is also likely to back countermeasures as the country's largest energy company, Eni, plans to begin drilling in the Russian sections of the Barents Sea and the Black Sea. According to the company website"Approximately 30% of Eni's natural gas is supplied by Russia. These supplies are out of the reach of current sanctions."

The bill was also harshly criticized by the president of the European Commission, Jean-Claude Juncker, who said that “'America first' cannot mean that Europe's interests come last.”