US President Barack Obama and German Chancellor Angela Merkel have given a fresh push to a potentially huge US-European trade pact despite mounting opposition.

Obama said after talks with Merkel in Hanover on Sunday that the deal could be reached by the end of the year.

"Angela and I agree that the United States and the European Union need to keep moving forward with the Transatlantic Trade and Investment Partnership (TTIP) negotiations," he said.

TTIP: The mother of all trade deals?

"I don't anticipate that we will be able to have completed ratification of a deal by the end of the year, but I do anticipate that we can have completed the agreement."

If a deal is signed, it would form the world's biggest trading bloc. 


WATCH: Is this the mother of all trade deals?


Those in favour of the pact say it could create millions of new jobs and increase trade by billions of dollars - a much-needed stimulus for the global economy. But opponents believe it is undemocratic and would give big companies too much power. 

Free-trade advocates say the TTIP will form a market of 800 million people, create millions of jobs and serve as a counterbalance to growing Asian economic clout.

Anti-TTIP activists, campaigning under the banner "Stop TTIP", say an accord would undermine European food and environmental laws and give too much power to US corporations.

'Unsettled by globalisation'

"As you see other markets like China beginning to develop and Asia beginning to develop and Africa growing fast, we have to make sure our businesses can compete," Obama said.

Merkel echoed that sentiment, saying the deal would be "extremely helpful" for growth in Europe.

"It is good for the German economy, it is good for the European economy," she said.

But Obama acknowledged there was popular opposition, saying that many opponents of the deal were unsettled by globalisation. 

"People visibly see a plant moving and jobs lost and the narrative develops that this is weakening rather than strengthening the position of ordinary people and ordinary workers," he said. "The benefits often times are diffused."

About 200 protesters gathered in Hanover on Sunday to protest against the deal, with organisers saying they had expected considerably more people to turn out


OPINION: Why Berliners mobilized against a US-EU trade deal


The demonstration started in the centre of the city and moved to the Congress Centre where Obama opened the Hanover industrial trade fair with Merkel on Sunday evening.

The day before, though, police said as many as 35,000 people in Hanover had taken to the streets.

Obama will wrap up his visit on Monday with a speech designed to frame his vision of transatlantic relations and a meeting with Merkel and the leaders of Britain, France and Italy.

Despite the diplomatic niceties, the relationship between Obama and Merkel has had its rocky moments, hitting a low in 2013 when the US government was found to have been tapping Merkel's phone.

But officials point to the Ukraine conflict as a turning point that allowed both leaders to work more closely together.

Source: Al Jazeera and agencies