Julian Borger and Nicholas Watt: Europe risks US sanctions over China arms sales

From Guardian Unlimited:

America and Europe were yesterday being drawn ever closer into a trade war after senior US congressman issued a blunt warning to the over its plans to lift a 15-year-old arms embargo on China.

Talking explicitly about how it would retaliate for the first time, Richard Lugar, the powerful republican head of the Senate foreign relations committee, warned that the US would stop sales of military technology to Europe.

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