Trump’s prices add an emergency to the talks of the German coalition, said Merz – Politico

The strength of the German economy lies in the export of goods such as machines, chemicals and vehicles, and the United States is a key market. German exports have already become less competitive in recent years due to the increase in energy prices and other factors, and the 20% rate implemented by the Trump administration is still unwanted news for the industry.

The market shock added a new emergency to the coalition negotiations between the Christian Democrats in the center-right (CDU) of Merz and the Social Democrats of the Center-Gauche (SPD), after the national elections on February 23.

The CDU was published in the vote but failed to win a majority, forcing Merz to talks with the SPD to form a government. Coalition negotiations were briefly interrupted on Monday while Merz, outgoing Chancellor Olaf Scholz and SPD leaders have held consultations on how to respond to American measures, the German media report.

Merz, a longtime tax hawk, has already faced internal repression after having approved a constitutional amendment to grant up to 1 Billion of euros of new debt – a key request from the SPD and the Green Party. His comments on Monday aimed to reaffirm the traditional accent of the CDU on the budgetary and economic discipline in the midst of a changing world landscape.