Merkel’s successor will resume relations with Washington

FRANKFURT – “The times when we could totally trust others – are over.”

These were the words of German Chancellor Angela Merkel, after a difficult meeting of the G-7 and NATO with President Donald Trump in 2017. This phrase marked a departure from her usual feeling about the transatlantic relationship and was widely seen as a watershed.

Despite a barrage of statements from the Trump administration, Merkel preferred to remain calm for years to come, probably waiting for a new president in 2020.

She and the German establishment got what they wanted: in Joe Biden, there is a new US leader with a clear multilateral and pro-European agenda.

But although relations are much more friendly on the surface now, some central questions remain.

“The big topics like Nord Stream 2 and the NATO spending target of 2% of GDP will remain controversial,” said Andreas Dombret, board member of Atlantik Brücke, a non-profit organization that promotes German-American relations, in a telephone interview with CNBC. Nord Stream 2 is the Russian-led gas pipeline that is expected to provide Europe with a sustainable energy supply.

“There is no green light for the new United States administration, especially when it comes to a free trade agreement, which is probably not within reach,” added Dombret.

Predicting the future of Germany-United States relations is not an easy task, as many factors are at stake. For example, it appears that the United States requires a clear commitment to prioritize relations with the White House over relations with China and Russia.

“We have to react against the Chinese government’s economic abuses and coercion that undermine the foundations of the international economic system,” said President Joe Biden in his speech during the Munich Security Conference in February.

“The Kremlin attacks our democracies and arms corruption to try to undermine our governance system,” he added in another part of his speech.

Germany often puts its own economic interests above anything else when it comes to its relationship with Beijing. But that is bound to change.

“There is great pressure to change attitudes towards China, which is growing from within Germany, parties like the Greens, parts of the CDU (of Merkel) want a tougher line,” said Noah Barkin, editor in chief of the Rhodium Group’s China practice based in Berlin.

When it comes to Russia, things are more difficult, especially thanks to the controversial Nord Stream 2 pipeline, which has wide support in Germany. Russia’s problem is also perfectly related to the issue of NATO spending. Critics say Germany cannot ask for NATO support without paying its fair share of the budget, while financing Russia through the pipeline and waiting for the full US shield when things go wrong.

The Greens, being a potential creator of kings in Berlin with federal elections scheduled in September, have a different view, which is also recognized in the United States. The Green Party, founded in 1980 with a clear focus on the movement for peace and saving the environment, defended NATO’s departure and shutdown of military action. The party’s official line has changed since then, but the party leadership still has a hard time getting its members to fully support it.

Germany and other nations have been criticized for not contributing enough to their defense budgets, with NATO’s target set at 2% of GDP.

“I think the 2% orientation regarding NATO spending is an absurd debate,” said Annalena Baerbock, one of the Green Party’s candidates for chancellor and a rising star on the political scene, in an interview with the newspaper Die Zeit.

The direction of transatlantic policy will depend on the composition of the coalition government, as Merkel resigns and Germany votes for a new leader later this year. If your CDU party ends up ruling with the liberal party, the FDP, things are likely to go smoothly, as both have a firm commitment to the US

If the CDU joins the Greens, however, things get more complicated, mainly because of NATO spending. In the case of the so-called Jamaica coalition between the CDU, the FDP and the Greens, the latter will have two major counterweights in Parliament to possibly dilute any legislation they defend.