Monday 23 October 2017

White House launches scathing attack on the EU

German Chancellor Angela Merkel. Photo: Leonhard Foeger/Reuters
German Chancellor Angela Merkel. Photo: Leonhard Foeger/Reuters

Peter Foster and Szu Ping Chan

Donald Trump's administration launched a new attack on the EU last night, accusing Germany of profiting from a "grossly undervalued" euro to boost exports at the expense of America.

Peter Navarro, the president's chief trade adviser, said Angela Merkel's government was using its dominant position in the currency union to unfairly exploit its European neighbours.

The incendiary remarks - 24 hours after the German chancellor criticised Mr Trump's immigrant travel ban - represent a new front in the president's assault on the EU.

He has frequently criticised Brussels and last week told Theresa May that Brexit presented a "fantastic" opportunity for Britain.

Mr Navarro's words cap an extraordinary first 10 days of the new administration, that now puts Washington at loggerheads with Paris, Brussels and Berlin. Speaking to the 'Financial Times', the head of the new National Trade Council confirmed that the Transatlantic Trade and Investment Partnership (TTIP), the trade deal started by the Obama administration, was now effectively dead.

And he accused Germany of continuing "to exploit other countries in the EU as well as the US with an 'implicit Deutsche Mark' that is grossly undervalued".

The attack sent jitters through the currency markets.

The assault on the weak euro effectively sees Germany being lumped together with China and Japan as "currency manipulators" that Mr Trump vowed to confront to protect US jobs and industry. "We sit there like a bunch of dummies," Mr Trump said after a meeting with pharmaceutical executives yesterday, as he emphasised the need to bring drug manufacturing back to the US.

The trenchant anti-EU rhetoric from Washington was greeted with alarm in EU capitals.

Ms Merkel rejected Mr Navarro's claims, saying Berlin had no influence over exchange rates and supported an independent European Central Bank. (© Daily Telegraph, London)

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