German Chancellor-in-waiting (set to become chancellor in May) Friedrich Merz has warned that Trump’s tariff policies could accelerate the onset of a global financial crisis. In an interview with Handelsblatt, Merz urged a new U.S.-EU free trade agreement, proposing “zero percent tariffs on everything” as a mutually beneficial solution.

The EU has already floated a “zero-for-zero” tariff proposal on industrial goods, but Trump dismissed it as insufficient and suggested Europe should instead buy more U.S. energy.

Merz said Europe would need to shift focus to other markets if the U.S. withdraws from global trade:

• “Trump’s policies are increasing the risk that the next financial crisis will hit sooner than expected”
• “We Europeans need to come up with a persuasive response.”