EU Companies Worry About New Russian Trade Bloc

BRUSSELS (AP) — The European Union's biggest business federation said Friday it was worried that a new customs union between Russia, Kazakhstan and Belarus could introduce a new trade tax damaging to European exports.

BusinessEurope said it believed that the three nations would on Jan. 1, 2010 apply higher trade charges, extending and making permanent export taxes that Russia initially introduced on a temporary basis.

"This would worsen market access conditions for Europe's exporters ... and cause serious harm for several important European industries including the automotive, steel, machinery and food industry," it said.

BusinessEurope said this would violate pledges by the Group of 20 rich and developing nations to shun new trade barriers and would harm the trade and investment climate in the three countries.

It called on the EU's trade commissioner Catherine Ashton to seek clarifications from Russia on how the customs union would affect European trade when she meets Russian officials at a summit in Stockholm on Nov. 18.