German Chancellor Friedrich Merz is scheduled to meet U.S. President Donald Trump on Thursday, with numerous pressing issues at the forefront, including trade tensions and the ongoing conflict in Europe.
During both of Trump’s terms in office, relations between the United States and the European Union have been strained, with rising tensions complicating diplomatic interactions.
“The tone has not been this tense in a long time,” stated German Foreign Minister Johann Wadephul during a recent address discussing the state of German-U.S. relations.
In recent months, officials from the White House have expressed criticism toward Berlin, and the sentiment has been reciprocated. Nevertheless, there are indications of improving relations, with both leaders reportedly moving to a first-name basis following several phone discussions. This rapport is expected to be a priority for Merz during his visit to Washington.
“Merz’s key goal will be to resonate positively with Trump,” said Jörn Fleck, senior director of the Europe Center at the Atlantic Council, in comments to Finance Newso.
Merz’s conservative stance on immigration, his ties to American businesses—being a former executive at BlackRock—and his image as an underestimated outsider who won election on promises to rejuvenate the economy and security may prove advantageous, according to Fleck.
Trade
Germany’s economy, heavily reliant on exports, identifies the U.S. as its largest trading partner, making it particularly susceptible to Trump’s trade policies.
Penny Naas, who oversees strategic competitiveness at the German Marshall Fund, highlighted concerns about sector-specific tariffs, particularly those affecting the automotive and steel industries, stating they “strike at the heart of Germany’s economic structure.”
Merz is likely to seek leverage for negotiations regarding these tariffs, with suggestions that the U.S. and EU should mutually eliminate all industrial tariffs, Naas noted.
Furthermore, Trump’s reciprocal tariffs, which have also impacted countries in the European Union, are expected to be a significant topic of discussion, as indicated by Franziska Palmas, a senior Europe economist at Capital Economics.
“He will advocate for free trade and a U.S.-EU trade agreement,” Palmas said, suggesting that Merz may highlight the EU’s proposal for a zero-for-zero tariff deal as an optimal resolution.
While negotiations between the U.S. and EU have faced challenges, European Trade Commissioner Maros Sefcovic recently indicated that discussions were “moving in a favorable direction.”
Support for Ukraine
The ongoing war between Russia and Ukraine is anticipated to be a major topic, especially following Trump’s phone call with Russian President Vladimir Putin on Wednesday.
European leaders have urged Trump to exert pressure on Putin, a directive Merz is expected to echo, according to Fleck.
Additionally, Palmas mentioned that Merz would likely “reaffirm Germany’s strong support for Ukraine and the importance of European participation in peace talks.”
Uncertainty surrounding U.S. support for Kyiv, coupled with Trump’s emphasis on expediting negotiations with Russia, has raised alarms within Europe.
Key issues such as U.S. backing for European troop deployments, sanctions enforcement, and information sharing are expected to be addressed, Fleck added.
NATO spending debate
Discussions surrounding NATO, in which both Germany and the U.S. are key players, will also be crucial, particularly regarding members’ defense spending commitments. Trump has long advocated for these contributions to reach 5% of each nation’s GDP, facing resistance on the matter.
Fleck noted, “Merz will strive to ensure that Germany is not perceived as lagging in defense spending and capabilities.”
Given recent reforms in Germany that allow for increased defense expenditures and the country’s support for Trump’s 5% NATO spending initiative, Chancellor Merz may have “a favorable narrative to present” during talks.
Palmas from Capital Economics added that Merz could potentially use this opportunity to announce a specific defense spending objective.
