Despite warmth, Merkel and Trump still differ on trade

With Trump poised to impose tariffs on steel soon that will impact European exports, Merkel said the decision is now in Trump’s hands on whether to grant exemptions to European Union nations.

“The president will decide. That’s very clear,” Merkel told a joint news conference with Trump after the U.S. president complained about the U.S.-European trade imbalance, particularly in regards to automobiles.

“We had an exchange of views. The decision lies with the president,” she said.

Merkel also said she could see negotiating a bilateral trade deal between the EU and the United States, saying the World Trade Organization has been unable to deliver multilateral agreements.

Trump said he wanted a “reciprocal” trade relationship with Germany and other European nations and wanted Germany and other NATO allies to pay more for the common defence.

“We need a reciprocal relationship, which we don’t have… We’re working on it and we want to make it more fair and the chancellor wants to make it more fair,” Trump said.

After their last White House meeting drew attention when the two leaders did not shake hands in the Oval Office, Trump made a point of doing just that, twice, while congratulating the German chancellor on her recent election win.

“We have a really great relationship, and we actually have had a great relationship right from the beginning, but some people didn’t understand that,” Trump said in the Oval Office, calling Merkel a “very extraordinary woman.”

MANY DIFFERENCES

Merkel acknowledged that it took a while to form a government after heavy election losses to the far-right, but she said it was important to her to make her first trip out of Europe since establishing her administration to Washington.

The cautious Merkel has not established a particularly strong personal rapport with the brash Trump, and the mood of her one-day working visit contrasted sharply with the tactile “bromance” between Trump and French President Emmanuel Macron.

Chemistry aside, Merkel will try to make more progress than Macron, who, before heading home after a three-day state visit to Washington, acknowledged that Trump was likely to pull out of the multinational Iran nuclear deal.

The Iran deal, looming U.S. tariffs on European steel and aluminium products, a planned Russian gas pipeline running under the Baltic Sea to Germany, and Berlin’s military spending are issues that divide Merkel and Trump.

When asked if Germany was doing enough to reach a NATO target for member countries to spend 2 percent of economic output on defence annually, new U.S. Secretary of State Mike Pompeo told a news conference in Brussels:

“No…(Germany) should meet the goals that they agreed to…that’s the expectation, not only for Germany but for everyone. We’re hopeful that at the NATO summit that every NATO partner will deliver a credible plan to achieve that goal.”

Macron made the European position on the Iran nuclear deal clear ahead of Merkel’s visit.

On Wednesday, he called on the United States not to abandon the Iran deal as Western envoys said Britain, France and Germany were nearing agreeing a package they hope could persuade Trump to save the pact. This gives Merkel something to work with.

Trump will decide by May 12 whether to revive U.S. sanctions on Iran. Doing so would be a serious blow to the nuclear deal, which many Western countries sees as essential for stopping Tehran developing a nuclear bomb.

Source: reuters