Merkel Warns New Auto Tariffs Could Start A Trade War

Police looking at a van on the German border

Image Migrant numbers have fallen but German politicians know the issue continues to win votes

The announcement comes after hard negotiations between Chancellor and his Interior minister, Horst Seehofer, who agreed to establish closed migrant centres on German-Austrian border to accelerate return of asylum seekers To first community country where y were registered.

If migrants are not able to be taken to a "transit accommodation area" at the Munich airport, Germany's federal police will process arriving migrants at their existing facilities along the border, the government said in a statement.

Orban made clear that he believes asylum-seekers who register in Hungary must have come through Greece or Bulgaria first, and his country therefore won't feel obliged to take them if they are turned back by Germany.

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Interior Minister Horst Seehofer, leader of the Bavarian Christian Social Union (CSU), had triggered the crisis when he threatened to defy Merkel and turn back at the German border the small number of asylum-seekers - a maximum of five people a day - who turn up after registering in other EU states.

German Interior Minister Horst Seehofer adjusts his tie during a budget debate at the lower house of parliament Bundestag in Berlin, Germany, July 3, 2018. Mr Seehofer - whose party still faces pressure from the anti-immigration Alternative for Germany (AfD) in a regional election this October - has already threatened to start agitating again if the measures aren't implemented.

"Stocks are higher as improved political relations in Germany and constructive trade comments from China have lifted investor sentiment", David Madden, market analyst at CMC Markets UK, said, adding that the positive mood might not last. "That is why I am pleased we've found a solution".

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Mrs Merkel said Europe should protect its borders but without becoming "some sort of fortress".

Austria has been considering imposing controls at the Brenner Pass, one of Europe's busiest transport hubs, on its southern border with Italy.

Last week she even thanked the Hungarian leader for his efforts to bolster the EU's external borders, while Orban declared the "enormous success" of his tough stance in the conclusions of an European Union summit last week.

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However German media report that most of the irregular migrants entering Germany do not go through Austria anyway. Kurz indicated it would not be possible to push the idea of camps in non-EU countries during the next six months. "I am confident that we will reach an agreement with the SPD as well", he said. Kurz called for the agency to have 10,000 border guards by 2020, seven years earlier than anticipated by Brussels.

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