(Clinton takes tough stance)  (470)
By Jon Schaffer
USIA Economics Correspondent

Lyon, France -- Leaders of the major industrial nations say they are
willing to follow President Clinton's lead in seeking strong actions
to combat terrorists, but back off from supporting sanctions against
specific countries known to support terrorist activities.

Meeting at the annual Group of Seven (G-7) economic summit of
industrial nations June 27-29, the leaders agreed to hold a
ministerial meeting in July on terrorism and approved a 40-point
action plan to combat crime and terror activities.

But European, Canadian and Japanese officials were equally vocal in
opposing U.S. legislation aimed at isolating "rogue" states such as
Iran, Libya and Cuba. The legislation was one of three issues
discussed during a June 28 luncheon of the leaders.

The G-7 nations are the United States, France, Germany, Japan, United
Kingdom, Italy and Canada.

At issue are the Helms-Burton Act, which provides for sanctions
against individuals trafficking in U.S. property confiscated by Cuba,
and proposed legislation that would impose sanctions on companies that
invest in the energy sectors in Iran and Libya.

Europeans do not dispute that these countries have supported
terrorism, officials here say. Rather, European opposition to
sanctions stems from the belief that it is better to maintain open
channels of communication that would support more moderate elements in
these states.

Officials from Europe and Canada specifically protested the
"extra-territorial" dimensions of the Helms-Burton law, asserting that
it is a set-back for free and open markets and works against U.S. and
foreign interests.

Already several countries are considering legislation that would
counteract the effects of Helms-Burton on their companies.

Asked whether the June 26 bombing in Saudi Arabia lends credibility to
the controversial U.S. law, Canadian Prime Minister Jean Chretien
responded: "That does not justify that type of legislation.... If we
start on that game to solve some short-term political problems it will
never end."

Chretien said that he believes Clinton will listen to the views of his
G-7 allies but "I don't expect him to back down, especially at this

Dan Tarullo, assistant to the present for economic policy, told
reporters following the June 28 luncheon that Clinton "pushed ...
fairly hard on the issue of needing to confront terrorist states; to
take action against countries that are threats to democracy and to the
safety of our citizens."

A day earlier, Sandy Vershbow, senior director for Europe at the
National Security Council, said that Clinton told his counterparts
that while he wants to minimize potential frictions, he believes that
U.S. allies need to be more forceful in their approach to countries
like Cuba.