By Jeremy Pelofsky and Zoran Radosavljevic
BRDO, Slovenia (Reuters) - The United States and theEuropean Union sought on Tuesday to turn up the pressure onIran to drop its nuclear enrichment programme by saying theywere ready to go beyond a latest round of U.N. sanctions.
But President George W. Bush acknowledged the limits ofU.S. influence over Tehran and, in the twilight of hispresidency, appeared resigned to leaving the standoff to hissuccessor.
"I leave behind a multilateral framework to work on thisissue," Bush said after a U.S.-EU summit at a Slovenian castle.
"A group of countries can send a clear message to theIranians, and that is: We're going to continue to isolate you... we'll find new sanctions if need be, if you continue todeny the just demands of the free world, which is to give upyour enrichment programme," he said.
He stopped short of repeating the U.S. position that alloptions, including military action, remain open. "Now is thetime for there to be strong diplomacy," Bush said.
He met Slovenian leaders, who hold the EU's rotatingpresidency, as well as European Commission President JoseManuel Barroso and EU foreign policy chief Javier Solana, whohas led efforts to get Iran to scrap its enrichment programme.
INCENTIVES
Solana is due to travel to Iran at the weekend to present anew offer by major powers of incentives for it to suspend theprogramme but he has played down prospects of a breakthrough.
"Iran with a nuclear weapon would be incredibly dangerousfor world peace," Bush said before setting off for Germany.
He is also due this week to visit France, Britain andItaly. A summit statement said the United States and EU wereready to deploy measures against Iran beyond existing U.N.sanctions.
All agree Iran should not be allowed to acquire nuclearweapons. Tehran insists the programme is for civilian purposes.
But it remained unclear how far the Europeans, who rarelyecho Bush's harsh rhetoric against Iran and have sometimes beenreluctant to get tougher, would be willing to go.
The United Nations Security Council has imposed threerounds of sanctions on Iran. Washington has pressed the EU todeny some Iranian banks access to the world financial system.
European External Relations Commissioner BenitaFerrero-Waldner told reporters after the summit:
"We want to indeed show to Iranians that we mean it veryseriously. ... (We are) particularly thinking of assetfreezes."
An Iranian newspaper said Iran was withdrawing assets fromEuropean banks and converting some foreign exchange assets intogold and equities to neutralise the impact of sanctions.
MORE COOPERATIVE
Bush was accused by critics of "cowboy diplomacy" duringhis presidency, largely due to the 2003 U.S.-led invasion ofIraq.
But the rancour has eased somewhat after Bush took a morecooperative approach in his second term.
Now many Europeans are looking increasingly past Bush tohis successor who will be chosen in the November election.
Bush acknowledges he is unpopular in Europe, as well as athome. "A lot of people like America. They may not sometimesnecessarily like the president," he told Slovenia's Pop TV.
On climate change, EU policymakers say they have given uptrying to get Washington to join with the bloc in signing upnow to binding cuts of greenhouse gas emissions.
Bush repeated on Tuesday that the United States would notagree to cuts until big developing nations such as China andIndia made commitments too. But he said a global climate changedeal could still be reached during his presidency.
C. Boyden Gray, the U.S. envoy to the EU, later explainedto reporters that Bush hoped the outline of a deal could emergefrom a meeting of the G8 rich countries in Japan in July.
That would pave the way for the next U.S. administration toengage quickly in negotiations in 2009 for a new treaty forwhen the first round of the Kyoto Protocol expires in 2012.
Bush confirmed his strong-dollar policy, despite thecurrency's slump to new lows against the euro recently.
"We believe in a strong dollar and that the relative valueof economies will end up setting the valuation of the dollar,"Bush told Tuesday's news conference.
(Writing by Matt Spetalnick and William Schomberg,additional reporting by Marja Novak; Editing by RobertWoodward)
