G7 and NATO Tests Trump and European Leadership

Liana Fix is a fellow for Europe at the Council on Foreign Relations. 

U.S. President Donald Trump will have the opportunity to come face-to-face with some of the United States’ closest allies twice this month. He will see members of the G7 this weekend in Canada, before meeting with NATO members in the Netherlands at the end of the month.

These meetings could help decide the future of American alliances and the trajectory of U.S. foreign policy efforts, particularly after escalating drone strikes in the Ukraine War and Russia’s refusal to come to the negotiation table have challenged Trump’s efforts to secure a ceasefire between Russia and Ukraine. But Trump and German Chancellor Friedrich Merz had an encouraging meeting in the White House last week, which relieved some concerns about the possibility of a tense visit.  

With these two meetings looming, did Merz’s meeting at the White House indicate that there was interest or room for further coordination with the United States on European security, Russia, and other related issues?

The visit of German Chancellor Friedrich Merz was not only relevant for Germany itself, but it was also relevant for the European Union (EU), because the European Union has three main areas of conflict right now with the Trump administration. The first is obviously the tariff and the trade war. Second is the Ukraine-Russia question, and the third is burden sharing—meaning how much the Europeans contribute to their own defense—which will be discussed at the NATO summit at the end of June in The Hague.

A particular sticking point for Europeans is they don’t have a seat at the table in Ukraine negotiations taking place between the United States, Ukraine, and Russia. But Europeans are trying to steer the direction of the U.S. president by calling him and trying to be the last ones that he speaks to, thereby countering some of the pro-Russian narratives that Trump has repeated in the past.

That’s exactly what Merz did in that meeting. He repeatedly argued that Europeans and Americans should work together to put pressure on Russia, and he tried to convey a narrative in the mind of Donald Trump that Russia is the problem in these negotiations. Russia needs increased pressure, not Ukraine.

Are Europeans having luck steering President Trump away from those narratives? It seemed to shock many when he said he had spoken to Putin after last week’s Operation Spider’s Web—Ukraine’s successful drone attack inside Russia.

What Russian President Vladimir Putin is doing very well is selling Donald Trump on the idea that Trump needs Russia. This is not only for U.S.-Russia normalization business opportunities but also for solving other problems that the United States has, including its issues with Iran. That is why Putin tries to sell Russia as an important interlocutor that will help the United States deal with Iran. That broadens the agenda in those talks and makes it easier for Russia to evade difficult questions on Ukraine.

This is exactly what European leaders are trying to counter. They are trying to keep Trump focused on putting pressure on Russia and avoid distractions, like phone calls with Putin or events in other parts of the world. These leaders are now receiving some help from Congress. Lawmakers on Capitol Hill have drafted a Russia sanctions bill that could be an instrument of pressure that Trump could use, but this has been a painstaking effort. 

How have these pressure points affected the Trump administration’s approach to ceasefire negotiations?

The Trump administration is looking at Russia’s invasion of Ukraine from the perspective of a neutral mediator. They don’t see themselves on the side of Ukraine, which contrasts with the Europeans, who do see themselves on that side. This is also what General Keith Kellogg, the U.S. special envoy for Ukraine and Russia, argued in his speech at the Council on Foreign Relations in March. The Trump administration will apply carrots and sticks to Ukraine and Russia equally. That comes back to the United States’ view of themselves as a neutral mediator between the two sides, which obviously leads to conflict with the Europeans.

There’s another side of this, too. Obviously, before the Trump administration came in, there had been a lot of close cooperation between Europe and the United States on sanctions evasion. One of the reasons why Russia can continue to afford to wage this war against Ukraine is because, according to an internal EU report, 80 percent of sanctions evasion goes through China. Because Russia can evade sanctions, thanks to China, it can reconstitute its military much faster than many military analysts have expected.

But now, cooperation on preventing sanctions evasion has broken down. The G7 has been a major platform for that, but now the Europeans are on their own. They have not had any significant exchanges with the U.S. side on how to put pressure on Russia through additional sanctions or enforcing current sanctions and making sure they really bite and prevent Russia from continuing this war. And this is obviously something that the Europeans also would love to see, by resuming cooperation on Russia sanctions with the United States and within the G7.

Despite these issues, are there other areas for Europe and the United States to work together in a productive manner? Does Merz’s cordial meeting lay some of that groundwork?

From a German perspective, establishing this good personal relationship between Merz and Trump is a significant step. Both previous German leaders, Olaf Scholz and Angela Merkel, had personalities that did not work particularly well when dealing with Trump. They were just very sober and unemotional politicians. Friedrich Merz has the advantage of his years in business. He worked for BlackRock Germany, he knows the United States very well, he’s from the conservative party, and he’s against illegal immigration. So all of that puts him in a better position from the very beginning.

But to say that there will be deepened cooperation is perhaps too much at the moment. The aim really is to prevent a further deterioration of the relationship. For Germany, a big issue is that it is one of the four countries—alongside Mexico, China, and Vietnam—with the greatest trade deficit with the United States. That obviously makes it a pretty big target for Trump. It does help that the European Commission is a little bit of a buffer for Germany because the European Commission is doing the trade negotiations, not Germany directly.

Defense spending is another tension point. How has a country like Germany’s defense spending changed, and is it realistic for them to hit the Trump administration’s new goal for NATO members to spend 5 percent of their GDP on defense?

Germany, for one, is subscribed to a plan outlined by NATO Secretary General Mark Rutte that divides the 5 percent up. You have 3.5 percent on the one side, which will be hard defense spending defined in the traditional way that NATO typically views this. There will then be 1.5 percent, which will be spent for resilience funds and similar items.

It’s easier for Germany to commit to this now because the debt break put into place in 2009 to prevent Germany becoming too indebted has made it difficult for Germany even to reach the 2 percent that was agreed at the NATO summit in 2014. The debt break was part of the German constitution, so that had to be changed to allow defense spending to be financed through a debt, which is now the only measure that can be financed through debt in an unlimited way. Everything beyond 1 percent of GDP defense spending that Germany would like to spend on defense can now be debt financed.

That is a huge step because no other country in Europe has that kind of fiscal flexibility to basically have unlimited loan-financed defense spending. Germany is now in a really good position to lead in the European Union, together with France, the United Kingdom, and Poland.

Is there an opportunity at the G7 to challenge or cool some of the tensions between Europe and the United States?

The challenge of the G7 will be that the United States has been very reluctant under the Trump administration to call out Russia as an aggressor in past G7 statements. It is hard to think that will change since they have positioned themselves as a neutral mediator. Another issue that will likely be discussed is the role of China. In the past, the United States has asked European countries to help counter what it perceives as China’s economic and security threat.

Both issues could be contentious at this summit. A G7 communiqué that doesn’t explicitly criticize Russia as the aggressor in this war would be unacceptable for European allies and, at the same time, China is the main supporter of Russia’s war. Europeans are afraid that they’re going to be caught in the middle of the United States’ trade war with China. That fear could exacerbate things, as the G7 will, of course, contend with the trade and tariffs war that is going on right now and the possibility that it could lead to greater financial instability.

This work represents the views and opinions solely of the author. The Council on Foreign Relations is an independent, nonpartisan membership organization, think tank, and publisher, and takes no institutional positions on matters of policy.