By Joseph Nasr
U.S. President Trump stunned allies on Sunday by backing out of a joint communique agreed by G7 leaders in Canada that had mentioned the need for "free, fair, and mutually beneficial trade" and the importance of fighting protectionism.
Trump, who has shocked allies by hitting them with tariffs on steel and aluminium, also said he might double down by hitting the auto industry, a particularly sensitive issue for Germany whose car industry relies heavily on the U.S. market.
"It is important that the Europeans act decisively," German Economy Minister Peter Altmaier told Deutschlandfunk public radio. "At the moment it seems that no solution is in sight, at least not in the short term."
"We are ready to discuss trade imbalances. We are ready to consider factual arguments. But we believe this should happen among friends and partners and not through reciprocal confrontation," Altmaier said.
Altmaier said that the G7 leaders' summit had produced "setbacks," adding that further tariffs by the Trump administration would not only harm its allies but also the U.S. economy.
Chancellor Angela Merkel on Sunday said Trump's backing out of the G7 final communique via Twitter was "sobering and a bit depressing." She promised an EU response to the steel and aluminium tariffs in line with World Trade Organisation rules.
Merkel will on Monday hold talks with International Monetary Fund Managing Director Christine Lagarde, WTO Director-General Roberto Azevedo, OECD Secretary-General Angel Gurria and World Bank President Jim Yong Kim.
(Editing by Peter Graff)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)