Merkel threatens Trump with trade war

ANGELA Merkel said on Sunday that Europe could enter a trade war with the United States if Donald Trump does not decide this week to prolong a key trade tariff exemption. Her intervention comes after her difficult meeting last Friday with Mr Trump at the White House where she appeared to secure none of the diplomatic breakthroughs she sought.

Firstly, she lobbied on Friday for an extension of the exemption, scheduled to expire late on Tuesday, from Washington's trade sanctions on steel and aluminium imports that were temporarily granted to Europe. Secondly, she pushed Mr Trump on the Iran nuclear deal which he has given the other signatories - Germany, France, United Kingdom, Russia and China - a May 12 deadline to "fix the terrible flaws" of. Or he will refuse to extend US sanctions relief on Iran.

Outside of these issues, Ms Merkel also got a rocky ride from Mr Trump who is much more critical than his predecessor Barack Obama on several longstanding issues in the bilateral relationship, especially trade and defence spending. On trade, Mr Trump called Germany on Friday "very bad" because of its significant trade surplus - with exports larger than imports - and the president has particularly singled out the nation's car exports which he has threatened to put tariffs on.