Merz invites Japan to back trade alliance as China asks Germany to be 'rational'

Germany Invites Japan to Form Global Trade Alliance as China Responds

Germany's Call for a Global Trade Alliance and International Reactions

By Andreas Rinke

Chancellor Merz's Proposal to Japan

TOKYO, Oct 28 (Reuters) - German Chancellor Friedrich Merz on Wednesday urged Japan to back a proposed global alliance to defend rules-based trade that he has been touting during a week-long Asia trip.

Alliance of Like-Minded Partners

An alliance of "like-minded partners" would help countries resist the growing use of tariffs and economic coercion, he told a business summit in Tokyo, according to prepared remarks.

Coordinated Response to Trade Violations

"Should the rules of the global trading system be violated by others, or should economic coercion be employed, we could coordinate our actions within the alliance and present a united front," he said, an apparent reference to the US and China.

China's Response to the Proposal

In responding to Merz's proposal, China said it hoped Germany and the EU would be "objective and rational" and that it was committed to working with all parties to maintain the stability of trade and supply chains.

International Context and Economic Implications

Echoes of Canadian Prime Minister's Call

Merz's initiative echoes calls by Canadian Prime Minister Mark Carney this year for the world's middle powers to work more closely together to counter pressure from larger economies.

Metaphor of Global Economic Influence

"If we move forward together, the question will no longer be whether we are 'on the menu' or 'sitting at the table'," Merz said, invoking a line used by Carney during his January speech.

"Because in that case, the restaurant itself belongs to us."

Germany's Trade Relations with China

Germany sees China as both a massive trading partner and a strategic rival. Coinciding with Merz's visit, a report said Germany's trade deficit with Asia-Pacific is set to hit a record of nearly €146 billion ($163 billion) in 2026 as falling exports to China outweigh growing sales elsewhere in the region.

(Reporting by Andreas Rinke, Writing by Miranda Murray; editing by Matthias Williams)