U.S. presidential candidate Barack Obama is expected to call on Europe to do more in hotspots like Afghanistan when he speaks in Berlin on Thursday in his only formal address of a week-long foreign tour.

Obama held talks with Chancellor Angela Merkel on issues ranging from the global economy, to Iran and Middle East peace after arriving in the German capital from Israel on a trip he hopes will burnish his foreign policy credentials and boost his election chances against Republican challenger John McCain.

In the evening he will speak at the "Victory Column" in Berlin's Tiergarten park, an address German media are comparing to former President John F. Kennedy's 1963 "Ich bin ein Berliner" speech. A crowd in the tens of thousands is expected.

In the 45-minute open-air appearance, Obama will ask Europe to shoulder more of the burden to help deal with global security threats, an aide to the Democratic senator told Reuters.

In Kabul on Sunday, Obama described the situation in Afghanistan as precarious and urgent. Both he and McCain have said Europe must step up its efforts there, but Merkel has said there are limits to what Germany, which already has plans to boost its troop numbers by 1,000 later this year, can do.

"Hopefully (the speech) will be viewed as a substantive articulation of the relationship I'd like to see between the United States and Europe," Obama said before landing in Berlin.

Relations between the United States and Germany reached a post-war low under Merkel's predecessor Gerhard Schroeder, who strongly opposed the U.S. invasion of Iraq in 2003.

But the conservative Merkel, who grew up behind the Wall in the communist East, has worked hard to repair ties and emerged as one of President George W. Bush's closest allies in Europe.

A small crowd of people cheered Obama as he arrived at the Chancellery. He and Merkel, who were meeting for the first time, shook hands, smiled and made small talk before holding talks that a German spokesman said touched on Iran, Afghanistan, Pakistan, Middle East peace, climate change and the global economy.

BRANDENBURG GATE DEBATE

Merkel opposed the Obama campaign's initial plan to hold the speech at the Brandenburg Gate, the historic landmark that stood on the eastern side of the Berlin Wall for decades and became a potent symbol of the Cold War.

She has said the landmark - where President Ronald Reagan famously urged Soviet leader Mikhail Gorbachev to "tear down this wall" - is a place for presidents, not candidates to speak and her advisers tried to convince the Obama campaign to hold the speech at a university or other low-key location.

A Pew Research Centre poll showed Germans favour Obama over McCain by a 49 point margin. But some German officials have said Obama, who could become the first black U.S. president, risks disappointing Europeans because their expectations are so high.

Around 700 policemen are providing security and traffic around the "Siegessaeule", a 230 foot (70 metre) high column built to celebrate 19th century Prussian military victories over Denmark, France and Austria, has been blocked off.

German television stations provided full-day coverage of the visit and some will broadcast the 7 p.m. (6 p.m. British time) speech live.

Seven hours before the address, tourists and locals were already queuing up and preparing for a party. On the road to the Victory Column, workmen unloaded beer barrels and built stands decorated in the "Stars and Stripes".

"I'm excited, Obama has charm and charisma and can give us the confidence to like America again," said 18-year old Berlin student Stella Semmelrath. Not everyone, however, was impressed.

"It seems to me like a big show. Americans just want to be loved again but I'm sceptical about it all and have to get to work," said local resident Juergen Schumann, 51.