EU-Iran Talks Irk United States

N E W   Y O R K, Aug. 7 -- It's one in the troika of President Bush's "axis of evil" and doing business with Tehran is forbidden for American companies, but U.S. allies are lining up to trade with a country Washington would prefer they ignored.

After years of wrangling, the European Union is in discussions that could create a cooperation agreement between some of the United States' cherished industrial allies and one its greatest enemies. So far, there has been little tension between the United States and the European Union, but if talks turn into trade agreements, officials say the relationship could be on the rocks.

The move by the European Union, which comes as the White House is floating ideas to topple Saddam Hussein's reign in neighboring Iraq, could signal a significant split between the United States and Europe regarding the Middle East.

Trade Talks

The talks are geared toward helping the sides reach a trade agreement. In 2001, the European Union informally imported about $6.5 billion in goods from Iran, most of which was oil, and exported about $7 billion in mostly industrial products.

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The current EU-Iran talks are designed to establish a permanent trade agreement, but the EU proposal also requires Iran to make several political commitments that could delay a deal.

EU officials are asking that Iran ratify and implement several U.N. resolutions concerning terrorism and weapons proliferation. The European Union also hopes to encourage Iran to help seek peace between Israelis and Palestinians.

"We do not believe an agreement between EU and Iran can only be about economic and commercial aspects — it also has to cover political aspects: human rights, fights against terrorism, etc.," EU representative Javier Solana said in a statement. "Our relation is a two-way relation — it will not progress unless there is a clear reciprocity."

The United States reportedly lobbied against the EU-Iran discussions when they were on the table in June, but a U.S. State Department spokesman said last week that their office was confident the European Union wouldn't take action that could bring it into conflict with the United States.