* Britain alarmed over reports of Russian military move
* Signs that EU unity over Russia sanctions is fraying
* Hungary joins Slovakia in criticising EU sanctions
By Adrian Croft and Barbara Lewis
BRUSSELS, Aug 15 European Union foreign
ministers voiced concern on Friday at reports that Russian
military vehicles had crossed into Ukraine overnight, but behind
the tough talk there were signs that EU unity over sanctions
against Moscow was fraying.
British Foreign Secretary Philip Hammond said he was alarmed
by reports in British papers that at least 23 Russian military
vehicles had crossed the border, and warned Moscow of serious
consequences if it did not withdraw any forces it had there.
NATO Secretary General Anders Fogh Rasmussen later said
there had been a "Russian incursion" into Ukraine, but stopped
short of characterising it as an invasion.
Ministers from two of the more hawkish EU countries, Sweden
and Latvia, said the EU could impose more sanctions if the
Ukraine situation deteriorated or Russia used an aid convoy as a
pretext for invasion.
But behind the rhetoric there were signs that a ban on most
food imports from the West, announced by Russia last week, was
undermining EU resolve to confront its biggest energy supplier.
Many EU capitals fear that a deepening trade war with Russia
could snuff out hopes of recovery. Data released on Thursday
showed economic growth in the 18-nation euro zone had already
slowed to zero in the second quarter of the year, even before
the impact of Russia's reprisals was felt.
Hungarian Prime Minister Viktor Orban said on Friday that
the EU had harmed itself economically with the sanctions on
Russia and called for a rethink.
Orban's remarks came a day after his Slovak counterpart,
Robert Fico, criticised the sanctions as "meaningless", saying
they would threaten economic growth in the 28-member EU.
Both countries have strong economic and energy ties with
Russia and have been critical of EU sanctions in the past.
IN THE FOOT
"The sanctions policy pursued by the West ... causes more
harm to us than to Russia," Orban said in a radio interview. "In
politics, this is called shooting oneself in the foot."
Lithuanian Foreign Minister Linas Linkevicius, arriving for
the EU foreign ministers meeting in Brussels, retorted that it
was better to shoot yourself in the foot than to let yourself be
shot in the head - a reference to fears in the former Soviet
republic over Russian assertiveness.
Swedish Foreign Minister Carl Bildt denied Russia's ban on
food imports had opened divisions within the EU. He said the
Russian reprisals would have a marginal impact on the EU but
would hurt Russia's emerging middle class.
The EU has always been divided into different camps over
sanctions - with countries such as Britain, France, Poland,
Sweden and the Baltics in the hawkish camp while countries such
as Greece, Bulgaria and Austria more reluctant.
There were signs the EU was holding out an olive branch to
Russian President Vladimir Putin.
The European Commission announced late on Thursday that
Putin, Ukrainian President Petro Poroshenko and Commission
President Jose Manuel Barroso had agreed to talks to try to
resolve Russian-Ukrainian disputes over gas pricing and trade.
Finnish President Sauli Niinisto told Putin on Friday that
both sides' sanctions were damaging bilateral ties, and proposed
to seek ways to end the Ukraine crisis.
After several rounds of mild sanctions on Russia over its
annexation of Ukraine's Crimea region and role in eastern
Ukraine, the shooting down of a Malaysian airliner over Ukraine
in July galvanised the EU to impose broad economic measures
affecting Russian access to European financial markets and
technologies used by the defence and oil sectors.
Russia's ban on EU food has led to fears of a glut of some
produce in Europe, leading the European Commission this week to
promise financial support for EU fruit and vegetable growers.
EU ministers did not discuss imposing any further sanctions
on Russia on Friday. Instead they focused on the impact of
sanctions on the EU's own economy.
The EU is also set to start a diplomatic campaign to try to
convince countries such as Brazil and Egypt that might be
tempted to fill the gap left by EU food producers in Russia to
"avoid playing ... an unfriendly game towards the European
Union," a senior EU official said.
(Editing by Robin Pomeroy)