Mandelson shows Iran his iron fist..

EU trade chief Peter Mandelson and regular visitor to Bilderberg meetings warned Iran over trade boycotts in response to the publication of “offensive” cartoons in Denmark.

"I would make it clear to the government of Iran that any boycott of Danish goods is a boycott of the European Union as a whole," Mandelson told The Associated Press during a retail conference in Prague. "I hope that the government (of Iran) will think twice."

"Kick one and we all limp", as they say in the leafy purlieus of Brusels.

The EU is Iran's principal trade partner. The 25 EU members had combined exports to Iran worth euro11.8 billion in 2004, while their combined imports were valued at euro9.2 billion,.(Source Eurostat)

Only euro171 million of that trade was with Denmark of which the bulk was machinery and pharmaceutical / medical products.

"I don't believe that a boycott is a legitimate response to public concern," said Mandelson. "I also think that a boycott hurts both sides and damages Iran's interests as much as it would European interests."

He added that the EU was working "to resolve this issue peacefully, quickly and with the minimum disruption to trade."

Any EU sanction available is unclear it has already suspended EU-Iran free trade negotiations because of concerns over Iran's nuclear program. The EU could apply its own economic sanctions, but officials are reported to say that none are currently being considered.

"We can only take action if it is state-sponsored. Chambers of Commerce are not governments," said Mandelson's spokesman Peter Power (see pic above) .

The EU are said to have made has made similar threats of trade and political action against Saudi Arabia and other Middle Eastern governments either at the WTO or elsewhere, if they are found to be behind boycotts of Danish goods over the cartoon controversy.

Iranian Commerce Minister Masoud Mirkazemi on Monday said that Iran would not allow any new permits for Danish goods. Onon Tuesday he told state-run radio that beginning that day all contracts and negotiations with Danish companies would be suspended.

Iran's Health Ministry said Monday it was canceling previously approved business deals for medical equipment with Danish companies.

Mirkazemi said Iran would not be put off. "The EU can respond any way it wants," he said.