Merkel warns against trade war as Trump takes aim at cars

The German border in Bavaria

Merkel ended a tense showdown with her arch-conservative Interior Minister Horst Seehofer Monday by agreeing to tighten border controls and set up closed "transit centers" to hold migrants on the Austrian frontier.

German Chancellor Angela Merkel said on Thursday she would back a lowering of EU tariffs on US auto imports, responding to an offer from Washington to abandon threats to impose levies on European cars in return for concessions, Reuters reports.Merkel said any such measures would require the European Union to also lower tariffs on cars imported from countries other than the United States, otherwise the plan would not be conform to World Trade Organization rules.

The agreement also says Germany will send back people who have applied for refugee status in other European Union members upon approval by the countries concerned.

Separately, Merkel said she wanted to protect Europe's "humanity" in dealing with migrants, spelling out her differences with Hungary's prime minister, Viktor Orbán, at a press conference in Berlin.

The leaders agreed on ditching so-called transit centers to process incoming asylum-seekers, rather there will now be "transit processes in police centers", CSU leader Seehofer told reporters.

"If the talks with Greece and Italy fail, we will have to think again about measures", Seehofer said.

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She has agreed bilateral deals with a number of countries, including Spain and Greece which are on the front line of migrant arrivals. If vehicles had to detour through the Gotthard tunnel in Switzerland, Austrian officials estimate it would add €124 (£110) to the cost of each journey.

Many countries in Central and Eastern Europe advocate an anti-refugee and anti-immigrant policy.

She added that the good functioning of the world economy depends on countries working together as partners, and also questioned the value of measuring surpluses and deficits by trade in goods alone.

However German media report that most of the irregular migrants entering Germany do not go through Austria anyway. Kurz indicated it would not be possible to push the idea of camps in non-EU countries during the next six months.

German Chancellor Angela Merkel on Wednesday warned US President Donald Trump against unleashing an all-out trade war after he threatened to impose steep tariffs on cars from the European Union.

Austria has become an enthusiastic supporter of a long-standing effort by the European commission to create a European border and coastguard agency, in contrast to the policy of previous Austrian governments.

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