A move towards ending trade barriers between Europe and the United States is to be announced by Chancellor Gordon Brown this week.

Mr Brown will be joined by American counterpart John Snow to launch the review at the CBI's annual conference in Birmingham.

Bringing down the barriers could boost European trade by £100 billion a year, according to initial Treasury estimates.

Removing tariffs could also increase growth by two per cent and create a million jobs in the European Union.

Now a review, modelled on the Cecchini report that paved the way for closer European economic integration, will more closely examine the problems and benefits.

US Treasury Secretary Mr Snow is accompanying President George Bush on his state visit to Britain this week.

Officials hope it will put in perspective the current row over US steel tariffs.

Mr Bush is widely expected to announce a deal on the issue during his visit that will avoid the threatened trade war with the EU.

Mr Brown will stress the possible benefits of trans-Atlantic free trade in his speech to the CBI on Tuesday.

"Just as in 1988, when Europe was at the outset of the great project to move towards deeper integration, the Cecchini report broke down the barriers preventing the creation of a single market in Europe by clearly showing the benefits in commerce and jobs," Mr Brown will say.

"So the UK, the US and other countries have agreed to proceed with a major transatlantic review on how we can move beyond the old trade disputes and reap the benefits of greater trade and investment liberalisation."

Mr Brown will also announce the creation of a new US/UK business forum to share best practice and address joint productivity issues.

There will also be a scheme allowing young British entrepreneurs spend time studying at US business schools.

The project has been dubbed Greenspan scholarships in honour of Alan Greenspan, chairman of the Federal Reserve.

"We will enable young entrepreneurs in the US and the UK to learn from one another and enhance the transatlantic collaboration between universities and research institutes," Mr Brown will say.

He and Mr Snow are travelling to the conference with about ten leading British business figures including tycoons Richard Branson and Stelios Haji-Ioannou.

He will tell the CBI: "What binds America and Britain together is not simply a shared history but shared values.

"These visits are not just to celebrate our special relationship but to cement that special relationship."

CBI chief Digby Jones yesterday warned Britain would be worst hit if a deal was not done on steel tariffs to avoid a EU/US trade war.

"We invest more in the United States than the rest of the European Union put together," Mr Jones said.

Monday November 17, 2003