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21st May 2022

Germany hopes for quick EU-US trade deal

  • Trump, having called Merkel's policies 'insane' earlier, now praised the German chancellor as 'brilliant' (Photo: g7.gc.ca)

Germany wants the EU to reach a trade agreement with the US as quickly as possible, German chancellor Angela Merkel told reporters on Monday (26 August).

"We want to come as quickly as possible to an agreement between the European Union and the United States because this is obviously of very great interest also to us, to enhance the trade relations between the EU and the US," Merkel said at a press conference with US president Donald Trump on the sidelines of a summit of G7 leaders in Biarritz.

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"We've said we want to bring this as quickly as possible to a successful solution," the chancellor said, adding: "Germany is going to work resolutely for this."

Trump said they had discussed an EU trade deal and that he hoped there would be no need to impose tariffs on German car exports. He added that the EU is "tough" on trade and the US has lost a lot of money because of that.

"We're very close to maybe making a deal with the EU because they don't want tariffs," Trump said, adding: "I think we're going to make a deal with the EU without having to go that route."

As Germany's economy shows signs of a coming recession, with business confidence plunging to its lowest level in seven years, the European economic export-reliant powerhouse is keen to avoid tariffs on its car industry.

Talks between European Commission president Jean-Claude Juncker and Trump last summer avoided a tariff war between the bloc and the US, and the two agreed to work towards a common trade agreement.

Since then discussions have moved slowly amid disagreements over whether to include agricultural products in the deal.

EU member states have given a mandate to the EU commission to start talks on eliminating tariffs for industrial goods in April, overcoming French reluctance on that front.

However, the US ambassador to the EU, Gordon Sondland, has warned that the US will not sign up to any trade deal with the EU unless agricultural goods are included.

The issue puts Germany and France at odds over the US trade deal.

The US administration could decide as early as November to impose painful auto tariffs, making the issue a top priority for incoming commission president Ursula von der Leyen.

German visit

Despite criticising Merkel's migration policies as "insane" and refusing to shake her hand in the chancellor's first Washington visit after the US elections, Trump this time praised the German leader.

"She's a brilliant woman and she understands exactly where everything is. She knows before most people," Trump said, adding that Merkel wanted to see the trade deal done.

Merkel seemed to have been surprised by Trump's announcement at the press conference that he will soon visit Germany, although the chancellor had invited the president on previous occasions.

After Trump's announcement, the mayor of the hometown of Trump's grandparents, Kallstadt, showed little enthusiasm for the US president, however.

"If he comes, then he comes, if he doesn't then he doesn't. Until then, our church clock will keep ticking as usual," mayor Thomas Jaworek said Monday, according to the DPA news agency.

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Trump keeps EU leaders waiting on tariffs

European leaders postponed their reaction to US announcement that the EU would be exempted from tariffs on steel and aluminium. "The devil is often in the details", said the Belgian PM.

Hogan sets out trade plans at commissioner grilling

Phil Hogan, the current agriculture commissioner, told MEPs the EU needs to defend itself in trade disputes but will try to work together with the US, if Washington is a willing partner.

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