Thaw in US-German relations

By Justin Webb
BBC correspondent in Washington

After two years of bitter animosity, Germany and the United States are once again friends.

That is the message Chancellor Gerhard Schroeder and President George Bush are seeking to convey.

The leaders agreed to work together to stabilise Iraq

The Bush administration has been at pains recently to point out how grateful it is for German military help in Afghanistan and to promise that although rebuilding contracts in Iraq are to go initially to nations which helped in the war that could change in the future.

Germany for its part has been stressing common goals particularly in the war on terror.

A nasty fallout

Relations really have been quite bad between the two countries.

American leaders were questioning the political good sense of Chancellor Schroeder and suggesting that he was acting in bad faith.

The Germans said the US was acting arrogantly.

It was quite a nasty fallout, but both nations realise that they have a lot to lose if relations are soured in the long term.

Germany is, as President Bush said, a very important country.

It is one of the leaders of the European Union. It is an economic powerhouse - albeit a rather damaged powerhouse in recent years.

There's nothing wrong with friends having differences and we're both committed to putting the differences behind us President Bush

For Germany not to be on board in the wider war on terrorism and other American policy objectives around the world would be quite a serious thing.

And both leaders realise that, which explains why they were so keen to patch up the differences they have had.

However, there is very little of substance that has changed.

From the American side, they are not yet in a position to tell the Germans that they can have their companies bid for contracts to rebuild Iraq.

From the German side, they are not yet ready to say they will send German troops to Iraq as they have to Afghanistan.

Changing mood music

The two men were asked mainly about Iraq but that subject was challenged for its place at the top of the agenda today by the more pressing question of the weakness of the dollar.

It is a weakness which has boosted American companies - with American goods much cheaper in Europe - and harmed European firms, with European goods more expensive in America.

There is still a suspicion on the German side that not enough is being done to keep the dollar at what they consider an acceptable exchange rate.

But the chancellor says he accepts President Bush's promise that he has not deliberately allowed the dollar to weaken in order to boost US manufacturers at the expense of Europeans.

On none of these things do we see agreement, but the mood music has changed with respect to the Germans and the Americans.

And mood music is important in international relations.

President Bush spoke very warmly about Chancellor Schroeder, saying that he made him laugh and has a great sense of humour.

And President Bush sets great store by his personal relationship with foreign leaders and on that subject he made it clear that things were going well.

It may well mean that some of those substantive issues might see progress in the not so distant future.