EU vows Russia action as Merkel said to see sanctions next week

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BRUSSELS — The European Union said Friday it will work "swiftly" to hit Russian industries with sanctions as support grows for the package of trade restrictions outlined this week.

German Chancellor Angela Merkel is pushing her colleagues to sign off on the measures by the end of next week and is prepared to accept curbs on her country's technology exports to win support, according to two German government officials, who asked not to be named because the discussions are private.

"We are getting to the point when sanctions will be painful and double-edged, but if we don't introduce them the situation could get even worse," Polish Foreign Minister Radoslaw Sikorski told TVN24 late Thursday.

The European Commission, the 28-nation EU's regulatory arm, will draw up detailed proposals for broader sanctions against Russia after getting the go-ahead from EU diplomats at a meeting that concluded Friday, commission spokeswoman Maja Kocijancic told reporters. Pressure for action has surged since a Malaysian Airlines jet was shot down over Ukraine last week.

EU governments have already agreed to go beyond sanctions that so far have been limited to travel bans and asset freezes on individuals and companies deemed responsible for the unrest in Ukraine. The next wave of restrictions may stop state-owned banks from financing themselves in Europe and prevent Russian companies buying high-tech equipment they need to develop the nation's energy resources, according to a confidential document obtained Thursday by Bloomberg News.

With the administration of President Barack Obama urging Europe to be bolder in its response to Russian encroachment in Ukraine, western EU nations swung behind calls by their eastern counterparts to target Russia's economy with sanctions.

The set of broader EU sanctions being drawn up by the commission is "a package we pressed for," Jean-Christophe Gray, spokesman for British Prime Minister David Cameron, said by phone Friday. "We want to see final agreement on it in the next few days."

Sentiment in Germany, which accounts for 30 percent of the bloc's exports to Russia, is also swinging behind broader sanctions with an industry lobby representing companies with business in Russia also giving its endorsement.

"We would support it 100 percent" if the EU imposes tougher sanctions, Eckhard Cordes, head of the BDI industry federation's committee for eastern Europe, said in comments reported by Handelsblatt newspaper today and confirmed by a spokesman. "If a price has to be paid, we will pay it."

The EU and U.S. are betting that President Vladimir Putin will be forced into a U-turn over Ukraine by undermining a Russian economy that is already weakening.

"Russia's economy wasn't in good shape before this started and, with the sanctions already in place, it's taken a serious hit," Joerg Forbrig, senior program officer for central and eastern Europe at the Berlin bureau of the German Marshall Fund of the U.S., said by phone Friday. "Russia can't shake this off very easily."

_ Delfs reported from Berlin.