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 The two leaders have been at odds over the U.S. National Security
Agency's spying habits since revelations from former NSA contractor
Edward Snowden last year showed the United States had listened in on
many of its allies, including Merkel.
Obama has since banned the practice of eavesdropping on allied
political leaders, but the measure has not placated Germany.
"We have a few difficulties yet to overcome," Merkel said in a joint
news conference with Obama at the White House, referring to the
conflict and pointedly declining to say, when asked, that trust
between the two nations had been restored.
Snowden's revelations caused indignation in Germany, which is
especially sensitive about surveillance after abuse by the Gestapo
under the Nazis and by the Stasi in East Germany.
Berlin has pushed in vain for a "no-spy" agreement with Washington.
Obama said the United States did not have such agreements with any
country, friend or foe. He said the United States was working with
Germany to work through rules that govern the relationship and to
avert misunderstanding.
"I think that we have gone a long way in closing some of the gaps,
but as Chancellor Merkel said, there's still some gaps that need to
be worked through," he said.
Obama said the United States would hold a "cyber dialogue" with
Germany to help address further differences in how their
intelligence operations worked. He made clear that the backlash in
Berlin, and with Merkel specifically, had affected him personally.
"Germany is one of our closest allies and our closest friends. And
that's true across the spectrum of issues: security, intelligence,
economic, diplomatic," he said.
"And Angela Merkel is one of my closest friends on the world stage,
and somebody ... whose partnership I deeply value. And so it has
pained me to see the degree to which the Snowden disclosures have
created strains in the relationship."
ALIGNED ON TRADE
German officials had not expected to obtain concessions from the
White House about spying during Merkel's trip.
The two sides were closer on the issue of trade, however. Both Obama
and Merkel said they were committed to bridging differences to reach
a U.S.-EU trade pact, known as the Transatlantic Trade and
Investment Partnership.
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"It will be very important for us to bring the negotiations very
quickly to a close," Merkel, referring to the talks about the pact,
said through a translator.
Europe and the United States see free trade as a way to create more
jobs. A deal could boost the EU and U.S. economies by more than $100
billion a year each.
But concerns about food safety and environmental standards, among
other issues, have dogged the talks.
Merkel said doubts about the pact had to be overcome.
"It's simply necessary, looking at the intensity of the
transatlantic partnership and the closeness of our partnership, for
us to have this agreement," she said.
Obama noted that TTIP would make it easier to export U.S. natural
gas to Europe. The United States is pushing the EU to diversify its
energy supplies as a result of the Ukraine crisis, which has
highlighted European reliance on Russia for oil and gas. The EU, in
turn, has pressed Obama to speed up approvals for U.S. energy
exports.
"The United States has already approved licenses for natural gas
exports, which will increase global supply and benefit partners like
Europe," he said. "And TTIP would make it even easier to get
licenses to export gas to Europe."
Merkel, in remarks later at the U.S. Chamber of Commerce, the
powerful business lobby, said she wanted to wrap up TTIP talks by
the end of 2015.
Asked if the Ukraine crisis would slow or stimulate talks, Merkel
said: "It won't be harder. Whether it will be easier, I don't dare
to say yet."
Without a free trade agreement it would take a long time for Europe
to get access to American natural gas, she said.
(Additional reporting by Susan Heavey and Krista Hughes; Editing by
Mohammad Zargham and Ken Wills)
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