Europe wants to 'avoid escalation' on Trump tariff threat: Merz

Germany and other European countries agreed "that we want to avoid any escalation in this dispute if at all possible", Merz said, adding that he would seek to meet Trump at the World Economic Forum in Davos on Wednesday.

"We simply want to try to resolve this problem together, and the American government knows that we could also retaliate. I don't want to, but if necessary, we will of course protect our European interests as well as our German national interests."

Leaders from the 27-nation bloc will hold an emergency summit in Brussels on Thursday to discuss their response to one of the gravest crises in years to hit transatlantic ties.

Merz said the threatened tariffs would harm both the United States and Europe.

"Customs duties are usually paid by those in the country where the imports are received –- in this case, American consumers," Merz said. 

"But (the tariffs) would also, of course, damage our economy, the European economy and, in particular, the German economy."

German Vice Chancellor Lars Klingbeil had earlier struck a harder tone, saying Europe "will not allow ourselves to be blackmailed".

"Europe will respond with a united, clear response, and we are now preparing countermeasures together with our European partners," Klingbeil said at a Berlin press conference alongside the French economy and finance minister, Roland Lescure.

- 'United, clear response' -

Klingbeil, who is also Germany's finance minister, said Europe's response could have three main strands. 

First, the current tariff deal with the United States would be put on hold. 

Second, European tariffs on imports from the United States, currently suspended until early February, could come into force.

And third, the EU should consider its powerful so-called anti-coercion instrument against Washington, he said.

Lescure agreed that Trump's threat amounted to "blackmail".

"Blackmail between allies of 250 years, blackmail between friends, is obviously unacceptable," said the French minister.

"We Europeans must remain united and coordinated in our response and, above all, be prepared to make full use of the instruments" of the European Union, he said. 

"We are determined to defend our sovereignty."

Klingbeil stressed that the "limit has been reached" when it came to the US leader making threats. 

"We are constantly experiencing a new confrontation that President Trump is seeking," he said.

sr-fec/fz/rl