By Jean-Baptiste Vey and Roberta Rampton
LA MALBAIE, Quebec (Reuters)

The United States and European Union will establish a dialogue on trade within the next two weeks, a French official said on Friday, signalling a modest step forward for bitterly divided allies at a Group of Seven summit in Canada

U.S. trading partners have been furious over President Donald Trump’s decision last week to impose tariffs on steel and aluminium imports from Canada, the European Union and Mexico as part of his “America First” agenda. Some countries have retaliated with their own levies on U.S. imports.

“The principle of a dialogue was agreed this afternoon,” the French official told reporters. “Everyone agreed, including President Trump.”

 

Leaders chat as they pose for family photo at the G7 Summit in La Malbaie
Germany’s Chancellor Angela Merkel talks with U.S. President Donald Trump at a family photo session with the leaders of the G-7 summit in Charlevoix, Quebec, Canada, June 8, 2018. REUTERS/Yves Herman

 

While G7 leaders confronted Trump with a slew of data on imports and exports in a bid to sway his thinking, Trump countered his own numbers and held his position that the United States was at a disadvantage on international trade, an official who followed the talks said.

But Trump struck a more affable tone after a meeting with French President Emmanuel Macron, saying the French leader was helping work out trade issues.

“Something’s going to happen. I think it will be very positive,” Trump said, without giving details.

 

Canada's Prime Minister Justin Trudeau meets with Britain's Prime Minister Theresa May during the G7 Summit in the Charlevoix town of La Malbaie
Canada’s Prime Minister Justin Trudeau meets with Britain’s Prime Minister Theresa May during the G7 Summit in the Charlevoix town of La Malbaie, Quebec, Canada, June 8, 2018. REUTERS/Christinne Muschi

 

Macron said it was possible to advance the trade issues that have split the U.S. and its allies.

“I think, on trade, there is … a way to progress all together,” he told reporters after his meeting with Trump. “I saw the willingness on all the sides to find agreements and have a win-win approach for our people, our workers, and our middle classes.”

 

Leaders meet at G7 Summit in the Charlevoix city of La Malbaie
German Chancellor Angela Merkel and French President Emmanuel Macron look on as British Prime Minister Theresa May (R) speaks during their meeting at the G7 Summit in the Charlevoix city of La Malbaie, Quebec, Canada, June 8, 2018. REUTERS/Yves Herman

 

German Chancellor Angela Merkel on Friday floated an idea to set up a way to resolve trade disputes between the United States and its allies. An official described Merkel’s suggestion as a “shared assessment and dialogue” mechanism, but gave no further details. It was unclear if the technical talks were part of her initiative.

The proposal was supported by other leaders present, the official said. European Commission President Jean-Claude Juncker offered to visit Washington for an assessment of EU-US trade to help resolve the dispute, an official said.

 

Leaders pose for family photo at the G7 Summit in Charlevoix
L-R: European Council President Donald Tusk, British Prime Minister Theresa May, German Chancellor Angela Merkel, U.S. President Donald Trump, Canada’s Prime Minister Justin Trudeau, French President Emmanuel Macron, Japanese Prime Minister Shinzo Abe, Italian Prime Minister Giuseppe Conte and European Commission President Jean-Claude Juncker pose for a family photo at the G7 Summit in the Charlevoix city of La Malbaie, Quebec, Canada, June 8, 2018. REUTERS/Yves Herman

 

Expectations for a major breakthrough on trade at the summit, however, remain low, with U.S. allies focussed on avoiding rupturing the G7, which in its 42-year history has tended to seek consensus on major issues.

“It’s highly unlikely there will be a final communique,” a G7 official said on condition of anonymity.

 

 

Merkel said it was not clear whether the group would issue a final directive, adding that failure to do so would be an honest reflection of the lack of agreement among Canada, the United States, Japan, Britain, Italy, France and Germany. The EU is also attending the summit.

Trump had set a combative tone before leaving Washington on Friday, saying he was “going to deal with the unfair trade practices” of other G7 members.

 

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