Merkel Bolsters G-20 Unity Against Trump in Latin America Visit

Edited by walterp on . Posted in Business, Politics

The German chancellor started a three-day trip to Argentina and Mexico on Thursday in a bid to shore up support for a Group of 20 agenda bent on supporting trade, protecting the climate and managing migration. The visit comes a month before Merkel hosts a G-20 leaders summit in Hamburg.

After trying and failing to persuade the U.S. president to stand by the Paris climate accord at a Group of Seven summit last month — prompting her to question U.S. reliability — Merkel is seeking to mount a campaign to stand up to the U.S.

“She’s essentially trying to arrive at a 19-to-1 outcome on these issues,” Jacob Kirkegaard, a senior fellow with the Peterson Institute for International Economics in Washington, said in a phone interview. “She’s trying to isolate the Trump administration as much as possible.”

As Europe’s longest-serving leader, Merkel has emerged as a stabilizing force in a global order saddled by tectonic shifts brought on by the unpredictability of Trump’s “America first” policy, a newly ambitious China aiming to extend trade leverage and an assertive Russia under President Vladimir Putin.

‘Extremely Regrettable’

The fallout from Trump’s decision to withdraw the U.S. from the landmark Paris climate treaty will throw into relief how isolated the U.S. administration is when it comes to addressing climate. Merkel plans to continue pressing the issue in the larger forum at the July 7-8 Hamburg summit, a German official told reporters in Berlin this week, speaking on condition of anonymity in line with government protocol.

Merkel, who called the U.S. exit “extremely regrettable,” secured additional allies when leaders from China and India visited Berlin last week. Chinese Premier Li Keqiang, speaking alongside Merkel, said hours before Trump’s announcement last Thursday that China would stand by its Paris commitments. Two days before that, Indian Prime Minister Narendra Modi said India would continue measures to stave off climate change.

After visits to G-20 nations including Russia and Saudi Arabia this year, Merkel will round out the carousel of talks in Buenos Aires and Mexico City. Argentine President Mauricio Macri, who has opened the economy since taking office in 2015 after more than a decade of protectionist policies, will take over the G-20 presidency next year. In Mexico, President Enrique Pena Nieto has had his own run-ins with Trump.

“The world views of the presidents of Argentina and Mexico are broadly consistent with hers in terms of some of the global issues, whether it’s climate change or financial management,” Eric Farnsworth, vice president of the Council of the Americas, a New York-based organization that promotes open markets, said in an interview. “I think she’ll be received pretty well.”

Trade Ties

Merkel will be eager to showcase stronger trade ties against the backdrop of Trump’s shift toward protectionism. Germany will push to complete negotiations on a trade accord between the European Union and the Mercosur, a South American trade bloc, by the end of the year, according to the German official.

German officials expect a more compliant government under Macri, who has lifted currency controls as well as some trade barriers and settled an outstanding legal dispute from Argentina’s 2001 debt default.

Mexico is looking to diversify its trade to make itself less dependent on the U.S. Those efforts include negotiating with the EU to update a trade agreement that went into effect in 2000, six years after the North American Free Trade Agreement with the U.S. and Canada.

While Mexico sends just 5 percent of its exports to the EU, compared with more than 70 percent to the U.S., updating the nation’s trade pact with Europe could help Mexico show Donald Trump’s administration it has other commercial options, Kirkegaard said.



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