German Chancellor Angela Merkel said yesterday that free trade was important for both the US and Germany in a speech to business leaders in Munich ahead of her trip to meet US President Donald Trump in Washington.

She also said she believed it was essential to talk with each other rather than about each other and would use that philosophy as a guide to her talks with Trump.

“The United States of America is a key trading partner for Germany and for the entire European Union,” Merkel said ahead of her visit today.

“Trade is advantageous for both sides and I’m looking forward to the chance to speak to the newly elected American president about these issues.”

Merkel also said: “I believe that direct, one-on-one conversations are always much better than talking about each other. Talking together instead about each other – that’ll be my slogan for this visit, which I’m really looking forward to.”

Trump has called Merkel’s decision to allow hundreds of thousands of refugees into Germany a “catastrophic mistake”.

He has also threatened to impose tariffs on German carmakers that import into the US market and has criticised Berlin for not spending more on defence. Another source of tension is Germany’s €50 billion trade surplus with the US.

Causes of friction between Berlin and the US administration also include an accusation by a senior Trump adviser that Germany profits unfairly from a weak euro, and a threat to impose 35 per cent tariffs on imported vehicles.

The US is Germany’s biggest trading partner, buying German goods and services worth €107 billion last year while exporting just €58 billion worth in return.

Merkel said that German companies employ about 750,000 people in the US and a total of one to two million jobs in the US are indirectly dependent on German companies.