Berlin, July 5: German Chancellor Angela Merkel said Thursday she would back opening talks with trading partners on lowering automobile tariffs, in what appeared to be an olive branch to US President Donald Trump as the EU battles to dissuade him from imposing hefty levies on European cars.
But Merkel said that any negotiations on lowering tariffs in one area could only be conducted with “all the countries with which we have trade in cars,” rather than just with the United States.
A deal with the US alone “would not conform with WTO” rules, she said.
“We can either have negotiations about a wide range of tariffs, for 90 percent of goods,” Merkel said in a reference to the stalled talks for a transatlantic free-trade deal known as TTIP.
“Or we can talk about one type of goods, but then we must accord the same treatment to all trading partners of the world. That's an option I could imagine,” she added.
Merkel's offer came after US ambassador in Berlin, Richard Grenell, hosted bosses of Germany's biggest car firms for talks on Wednesday when he called on the EU to bring tariffs to zero on car imports — in exchange for equal treatment by the US.
Noting that the EU will negotiate as a bloc, Merkel said European Commission chief Jean-Claude Juncker would be heading to Washington for talks in a bid to head off a trade war with the US.
Trump on Sunday charged that Europe is “possibly as bad as China” on trade, as he reiterated that he is mulling import taxes of 20 percent on EU cars, after having already imposed punitive duties on steel and aluminium.
The EU has slapped tariffs on iconic US products including bourbon, jeans and Harley-Davidson motorcycles, as a symbolic tit-for-tat response to the metal duties.
In a speech to German lawmakers on Thursday, Merkel said both sides were already effectively locked in a “trade conflict”.
“It is worthwhile to prevent this conflict from becoming a real war,” she said, adding however that this “would require both sides” to take steps.