German Chancellor Angela Merkel said yesterday (27 June) she wanted to resume talks between the European Union and the United States on the Transatlantic Trade and Investment Partnership (TTIP).
“I am in favour of resuming negotiations on such a free trade accord — and also resolving all the problems together,” Merkel told an economic symposium of her ruling Christian Democratic Party.
Merkel, who will host leaders of the G20 leading economies next week at a Hamburg summit where trade is expected to be one of the most divisive issues, also said that Germany’s large trade surplus was partly the result of factors beyond her influence: the ECB’s expansive monetary policy and energy prices.
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“My vision of globalisation is that in the global and interconnected world we need a rules-based trade system where all sides can win,” Merkel said. “There is also an understanding of globalisation that there are winners and losers as if it is a zero-sum game and I don’t believe in this.”
Initial talks on the TTIP, which would create a huge free trade area on both sides of the Atlantic, came to a halt when Donald Trump won the US presidency after campaigning on a protectionist programme.
On taking office he withdrew from the Trans-Pacific Partnership trade deal with Pacific Rim economies – but US Commerce Secretary Wilbur Ross said last month Washington was “open” to resuming TTIP talks.
“It makes sense to continue TTIP negotiations and to work towards a solution that increases overall trade while reducing our trade deficit,” Ross told broadcaster CNBC on 31 May.
Wilbur Ross said administration open to TTIP light. Like with China, small steps work. @AspenInstitute
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Bent on tackling trade deficits, the Trump Administration now appears to have its heart set on reducing the trade imbalance with EU states, Germany in particular, in the hope it can open up their markets for US firms.
Germany, which last year turned in a record trade surplus, has been in Washington’s sights since Trump came to power.
Meeting senior EU officials in Brussels last month, Trump’s top economic adviser Gary Cohn said the US president thought that Germany is “very bad on trade,” citing its car exports as an example.
Last year, the US trade deficit in goods with Germany clocked in at a little under $65 billion — albeit some five times lower than with China.