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Germany's Chancellor Angela Merkel (L) is greeted by Canada's Prime Minister Stephen Harper and his wife Laureen as she arrives at the G20 Summit in Toronto, June 26, 2010.

German Chancellor Angela Merkel will visit Canada Aug. 15-16, the Prime Minister's Office announced Thursday.

The visit by the European Union's most powerful leader will mark the Chancellor's first bilateral visit to Canada, though she did visit Muskoka and Toronto in 2010 as part of the back-to-back G8 and G20 summits.

"As Canada and the European Union work to conclude free trade negotiations, I look forward to a wide-ranging discussion with Chancellor Merkel on the challenges facing the global economy," Prime Minister Stephen Harper said in a statement.

During Europe's ongoing economic crisis, Canada has been both a friend and an irritant to Germany.

The Germans were pleased with comments from Mr. Harper and Finance Minister Jim Flaherty that fiscal prudence – not more deficit spending – is the best path for Europe to take. However Germany has not appreciated the Conservative government's derisive rhetoric about "sumptuous euro welfare state countries" in refusing to provide additional bailout pledges to the International Monetary Fund.

The statement from the Prime Minister's Office says the visit will provide an opportunity to discuss trade and investment, peace and security matters and recent developments in the Middle East and North Africa.

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