Photographer: Krisztian Bocsi/Bloomberg

Germany, China Stand Up for Free Trade Before Trump-Merkel Talks

  • Merkel, Xi pledge cooperation to keep global markets open
  • Trade on agenda for Merkel’s first White House visit to Trump

Germany and China vowed to defend open global markets, a day before German Chancellor Angela Merkel plans to meet President Donald Trump in Washington to discuss concern about a U.S. shift toward protectionism.

In a phone call on Thursday, Merkel and Chinese President Xi Jinping “reaffirmed their common support for free trade and open markets” and “agreed to continue their trusting cooperation,” the German government said in a statement.

Timed just hours before Merkel’s departure to Washington for her first meeting with Trump, the call between leaders of the world’s No. 1 and No. 3 exporters underscores a partnership that’s gained significance since the U.S. election. Trump has scrapped a trade pact with Pacific nations, while Merkel’s top lieutenant in the German parliament, Volker Kauder, has warned that Europe may retaliate against any new U.S. import tariffs.

Merkel, who is running for a fourth term in Germany’s election in September, plans to explain her view of the mutual advantages of free trade during her talks with Trump on Friday, according to German officials. Her first attempt on Monday was scrapped because of a snowstorm on the U.S. eastern seaboard.

While House Republicans have proposed the border-adjustment tax, Trump has still to explicitly endorse the idea as part of his plan to put America first and boost domestic production. U.S. Treasury Secretary Steven Mnuchin is said to plan to use his debut at Group of 20 talks starting on Friday in Baden-Baden, Germany, to insist that the U.S. won’t tolerate countries that use currency devaluation to gain an edge in trade.

‘Dark Room’

As the Trump administration vows to upend international trade accords, including pulling out of the North American Free Trade Agreement, Merkel’s government has redoubled its support for multilateral trade arrangements. 

Merkel spoke about trade cooperation with Chinese Prime Minister Li Keqiang in January, six days after Trump’s inauguration, while Xi rebutted Trump’s anti-trade stance at the World Economic Forum in Davos, Switzerland.

“Pursuing protectionism is like locking yourself in a dark room,” Xi said, in comments later quoted approvingly by Merkel.

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