Latest news with #tradeDispute
Japan Times
5 days ago
- Business
- Japan Times
After courting and criticizing Trump from afar, Merz now set to meet U.S. leader
German Chancellor Friedrich Merz has veered between boasting about common ground with U.S. President Donald Trump to bemoaning the U.S. leader's volatility and even mocking his bravado. Now, for the first time, he gets to deal with him face to face. After nearly a month in office and following weeks of negotiations, the 69-year-old conservative will travel to Washington for his inaugural meeting with Trump on Thursday. Past meetings between the two countries' leaders have often been formalities to reinforce their unshakable postwar partnership. This time is different. Stiff tariffs are looming for German exporters in Trump's trade dispute with the European Union, while American support for Ukraine in its defense against Russia's invasion hangs in the balance. A positive meeting might take some of the heat out of these issues, but the bigger risk is that tensions could boil over, setting back transatlantic ties even further. The chancellor is preparing for anything, according to an official familiar with the discussions in the chancellery in Berlin. Scenarios range from hearty handshakes like with French President Emmanuel Macron to the public berating received by Ukraine President Volodymyr Zelenskyy, said the person who asked not to be identified because the talks are private. Merz, who hadn't served in government before starting his term on May 6, is well aware his encounter with Trump will be delicate and has sought tips from more seasoned veterans. In recent weeks, he's spoken to a number of European leaders, including Italian Prime Minister Giorgia Meloni and Finland's President Alexander Stubb. With just weeks until the president has threatened to implement sweeping 50% tariffs on all European goods, the timing of the trip is critical. The EU and the U.S. are headed in the "right direction' in trade talks, though new American levies on steel and aluminum imports aren't helpful if both sides want to maintain momentum, Maros Sefcovic said. "Our goal is to maintain the momentum,' the bloc's trade commissioner added Wednesday after meeting with U.S. Trade Representative Jamieson Greer in Paris. Ahead of the trip to Washington, Merz has been advised to let Trump do most of the talking, according to the German official. Interruptions are a no-no, but if he does, he should be prepared to soften it with praise, the person said. The chancellor, who can be prickly and combative, has made it clear internally that he won't openly confront the U.S. president like Zelenskyy did, the person added. After clamping down on irregular migration and vowing to ramp up defense spending, Merz has taken steps to counter views in Washington that German leadership is weak, according to Sudha David-Wilp, a senior fellow at the German Marshall Fund. "He comes to the White House with less baggage,' she said. "Both leaders could write a new script together.' German Chancellor Friedrich Merz (left) looks on during a news conference in Paris on May 7. U.S. President Donald Trump (right) gestures as he arrives at the National Memorial Day Observance in Arlington, Virginia, on May 26. | AFP-JIJI In addition to geopolitical jeopardy, there's a lot at stake domestically. Merz's conservative bloc holds only a narrow lead in the polls over the far-right Alternative for Germany (AfD), which has been staunchly supported by Trump officials. The anti-immigration party is watching closely and wants Merz to break with Brussels to resolve the trade dispute with Trump, which the head of the Christian Democratic Union has rejected. "We shouldn't act as if German and EU interests are identical,' Beatrix von Storch, deputy leader of the AfD's parliamentary group, said in a video posted on social media. "We'll judge his visit on the extent he represents German interests in his discussion with Trump.' Recently, Merz seemed to mock Trump. When asked during a conference appearance how his first phone call went, the German leader mimicked the U.S. president's voice, drawing laughter from the crowd, and said that every second or third word out of the president's mouth was "great.' Merz, a former corporate lawyer, had long thought that he would get along with Trump because both have a business background, play golf and share a patriarchal outlook. They also both have an aversion for Angela Merkel. Merz's grudge stems from 2002, when the former chancellor ousted him as caucus leader. Trump famously avoided a handshake with her during an Oval Office meeting in his first term. During the campaign in early January, Merz — a longtime advocate for transatlantic relations — called Trump "very predictable' and a leader who "thinks what he says and he does what he says.' But Merz's optimism started to shift after Vice President JD Vance accused Germany of political repression by monitoring the AfD as a potential extremist group. His disillusionment showed on election night, when Merz said that Germany could no longer rely on the U.S. and that Europe needed to stand on its own. But with China expanding its influence and Russia's war against Ukraine still raging, the U.S. remains an indispensable ally for Germany, and Merz will be keen to strengthen that relationship. Foreign Minister Johann Wadephul expressed optimism that Merz's meeting with Trump will lead to a common understanding on key issues. "Ultimately, the U.S. cannot have any interest in Russia emerging victorious from its war of aggression against Ukraine' and in China benefiting from the transatlantic trade dispute, he said at an event in Berlin late Tuesday. That puts the spotlight on Merz and how he navigates the biggest test of his chancellorship so far, but he may be able to claim victory in Washington simply by not losing. "You can't chat with him; every encounter is a competition,' Merkel said in an interview with Spiegel magazine about her experience dealing with Trump. "The more people there were in the room, the greater his urge to be the winner.'
CNA
6 days ago
- Business
- CNA
Mexico threatens retaliation as US doubles metal tariffs, EU and others race to avoid further levies
WASHINGTON: Mexico has threatened to impose retaliatory tariffs after the United States doubled its import duties on steel and aluminium, deepening a global trade dispute that has disrupted markets and strained diplomatic ties. US President Donald Trump's decision to increase the levies to 50 per cent took effect at midnight on Wednesday (Jun 4), applying to all countries except the United Kingdom, which secured a temporary exemption via a preliminary trade agreement. Mexico's Economic Minister Marcelo Ebrard said the hike was 'unsustainable and unfair,' and confirmed that countermeasures were being prepared. 'We cannot accept this in silence. Our response will be firm but calibrated,' he said at a press conference in Mexico City. The Mexican Chamber of Commerce also urged immediate government action, while industry leaders warned of rising production costs and job losses in the country's manufacturing sector. EU, US cite progress in tariff talks Meanwhile, the United States and European Union reported progress during high-level trade discussions in Paris on the same day the new tariffs were enacted. EU trade negotiator Maros Sefcovic and US Trade Representative Jamieson Greer said the meeting was constructive, with technical-level talks continuing in Washington and further negotiations planned. 'What makes me optimistic is I see the progress, the discussions are now very concrete,' said Sefcovic. Greer echoed the sentiment, noting a 'willingness by the EU to work with us to find a concrete way forward to achieve reciprocal trade.' Markets react to metals hike Markets responded with volatility to the hike in tariffs, which doubled the previous 25 per cent duty rate introduced in March. Canada and Mexico, the US's largest trading partners for steel, are among those hit hardest. The new tariffs also jolt the aluminium sector, with Canada being the top exporter of the metal to the US. Prime Minister Mark Carney said Canada was engaged in 'intensive' talks to reverse the levies, which Ottawa considers illegal. Labour union Unifor called for reciprocal tariffs on US metal imports. The American Automotive Policy Council warned the measures would increase vehicle production costs and harm US competitiveness. Meanwhile, the Congressional Budget Office forecast a negative impact on US economic output. Broader fallout and 'best offer' deadline Wednesday also marked the deadline set by the White House for countries to submit proposals aimed at averting additional reciprocal tariffs expected to take effect on July 8. Only the UK has reached a provisional agreement so far, with talks continuing with other trading partners. The US has asked for concessions on both tariff rates and non-tariff barriers in exchange for exemptions. Minerals and manufacturing in flux Separately, supply chain concerns are growing over China's restrictions on rare earth exports. European automakers have reported production disruptions, while German carmaker BMW noted delays in its parts supply due to shortages of essential minerals. Global uncertainty over tariffs has already affected firms across sectors, with French spirits group Remy Cointreau slashing its long-term sales goals and German manufacturers citing reduced orders.
CTV News
6 days ago
- Business
- CTV News
Bank of Canada set for interest rate decision as tariff uncertainty persists
The Bank of Canada is seen in Ottawa, on Wednesday, April 16, 2025. THE CANADIAN PRESS/Justin Tang OTTAWA — The Bank of Canada is set to make an interest rate decision today as the United States' trade dispute continues to cloud the economic outlook. A poll of economists provided by LSEG Data & Analytics ahead of the decision shows they expect the central bank will leave its policy rate unchanged at 2.75 per cent. The central bank decided to hold its key rate steady at its last meeting in April, saying at the time that it needed more clarity on how the Canada-U.S. trade dispute would impact the economy. Statistics Canada said Friday that real gross domestic product topped expectations in the first quarter of the year as businesses rushed to get ahead of the tariff impact. The Bank of Canada said in April it would be less forward-looking for the time being and did not publish a central forecast for inflation and economic growth amid the considerable uncertainty. Annual inflation cooled to 1.7 per cent in April, dragged down by the removal of the consumer carbon price even as underlying inflationary pressures ticked higher. This report by The Canadian Press was first published June 4, 2025.
Yahoo
6 days ago
- Business
- Yahoo
Bank of Canada set for interest rate decision as tariff uncertainty persists
OTTAWA — The Bank of Canada is set to make an interest rate decision today as the United States' trade dispute continues to cloud the economic outlook. A poll of economists provided by LSEG Data & Analytics ahead of the decision shows they expect the central bank will leave its policy rate unchanged at 2.75 per cent. The central bank decided to hold its key rate steady at its last meeting in April, saying at the time that it needed more clarity on how the Canada-U.S. trade dispute would impact the economy. Statistics Canada said Friday that real gross domestic product topped expectations in the first quarter of the year as businesses rushed to get ahead of the tariff impact. The Bank of Canada said in April it would be less forward-looking for the time being and did not publish a central forecast for inflation and economic growth amid the considerable uncertainty. Annual inflation cooled to 1.7 per cent in April, dragged down by the removal of the consumer carbon price even as underlying inflationary pressures ticked higher. This report by The Canadian Press was first published June 4, 2025. The Canadian Press Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
26-05-2025
- Business
- Yahoo
ECB boss Lagarde says strong euro will help EU counter Trump tariffs
The head of the European Central Bank (ECB), Christine Lagarde, said in Berlin on Monday that she was in favour of a stronger euro to help counter the threat posed by the trade dispute with the United States. The world order that has existed for decades is "fracturing," Lagarde said at the Hertie School for governance. "Multilateral cooperation is being replaced by zero-sum thinking and bilateral power plays," she said. "Openness is giving way to protectionism." The "dominant role of the US dollar" was also being brought into question, she argued. "The changing landscape could open the door for the euro to play a greater international role," she said. According to Lagarde, about 20% of the world's foreign exchange reserves are held in euros, with the dollar accounting for 58%. Since Trump announced his global tariff package, the dollar has been under pressure and the euro is stronger against the dollar than it has been for over three years. This could bring "positive implications" including making loans in the EU more favourable, protecting eurozone countries from exchange rate fluctuations and better protection against sanctions, she said. "In short, it would allow Europe to better control its own destiny," she said. The grasp these opportunities, Europe needs to keep its commitment to open trade, keep its economic foundations strong and capital markets liquid, and strengthen its legal foundations, Lagarde said. These goals could be achieved "by uniting politically so that we can resist external pressures," she said.
