US and EU 'to issue Iran warning'

The summit is expected to focus on areas where the EU and the US agree

US President George W Bush is holding talks with EU leaders in Slovenia, at the start of what is expected to be his last tour of Europe while in office.

The BBC's Oana Lungescu in Ljubljana says they are expected to issue a joint warning to Tehran that more sanctions against Iran's banks are being readied.

They are pressuring Iran to abandon its nuclear programme, rejecting claims it is solely for peaceful purposes.

The summit will also focus on Zimbabwe, climate change, trade and energy.

Mr Bush will later go on to Germany, Italy, France, the Vatican and the UK.

'Carrot and stick' policy

There will be a tough joint message to Tehran about further sanctions against Iranian banks linked to nuclear proliferation and terrorism, our correspondent says.

Mr Bush spoke of the work to be done in Afghanistan, ahead of his trip to Europe

Mr Bush is also expected to apply pressure on individual European businesses to take a harder line.

Barclays Bank, based in Britain, has already responded to US pressure, and ended all dealings with Iran's Saderat Bank and Bank Melli.

The warning of sanctions is a stick that Washington is keen to wield, but it is ready to give the carrot one more try, our correspondent says.

EU foreign policy chief Javier Solana will go to Iran at the weekend with an upgraded offer of economic and political incentives.

The UN Security Council has approved three rounds of sanctions against Iran.

These include asset restrictions and travel bans on Iranian individuals and companies said to be involved in nuclear work.

The sanctions also ban the sale to Iran of so-called dual-use items - items which can have either a military or civilian purpose.

'No illusions'

As EU leaders prepare to bid goodbye to Mr Bush in Slovenia, they want to focus on what unites Europe and America, our correspondent says.

They are expected to call for an end to state-sponsored violence and urging the UN secretary general to immediately send a team to monitor human rights.

But on some key challenges like climate change, no-one is predicting a breakthrough, she adds.

The US envoy to the EU has warned Europeans not to have any illusions that Washington's position will change "magically" with a new president.

Ahead of the summit, Slovenian Foreign Minister Dimitrij Rupel made reference to the possible tensions, telling reporters: "As in all relationships, the EU and US sometimes have different views."