Irish premier welcomes EU pause on US tariff countermeasures

Irish premier Micheal Martin has welcomed the pausing of EU trade countermeasures, after US President Donald Trump abruptly announced a 90-day pause on a swathe of new US tariffs.

The Taoiseach said that they had understood from the start that there would be “a negotiating pathway” with the US and not to “overreact”.

He said that the impact of Mr Trump’s tariffs on bond markets was “influential” on his decision to announce a 90-day pause, but added “we’re not out of the woods yet”.

He said on Thursday: “The China-US economic conflict, that was very worrying. That has, on its own, the capacity to continue to dampen investment and lead to instability in the markets.

“Also, we’re conscious that the 25% (on steel and aluminium) still remains, and we’re looking at a 10% tariff as opposed to a 20% tariff. But I do welcome the EU decision.”

He said industries had also been calling for Ireland and the EU to “not overreact”.

He said: “Their soundings from the administration were that an overreaction could be counterproductive. We got the same from the administration as well.”

Mr Trump said he would be delaying tariffs on most nations for 90 days, while raising his tax rate on Chinese imports to 125%.

The US had announced a 20% tariff for the EU, which would have applied to Ireland, and a 10% rate for Great Britain and Northern Ireland.

The details of the pause were not clear, but the US treasury secretary has said Mr Trump will keep a 10% baseline tariff on most countries.

Ireland’s deputy premier, Simon Harris, said EU-US trade negotiations were now “likely”, after meeting US commerce secretary Howard Lutnick in Washington DC on Wednesday.

On Thursday, Mr Harris said he had briefed EU trade commissioner Maros Sefcovic about the meeting.

In a statement he said: “It has been my consistent position and the consistent position of the Irish Government and the European Union, that we need to get into substantive, calm, measured dialogue with the United States.

“It has always been our preference that would have happened before tariff announcements. Clearly that was not the position of the United States.

“However, after my discussions yesterday, it is now clear to me that such engagement and negotiation is likely.”

Mr Harris, who is also Irish foreign affairs and trade minister, added: “I believe it needs to happen in a timely fashion. All sides need to engage in good faith because uncertainty and turmoil is not the way forward.

“The trading relationship between the EU and the US is worth 1.6 trillion euro per year. It’s massively important in terms of jobs, growth and investment in Ireland, across the European Union and in America.”

On Thursday the EU announced a 90-day pause in its retaliation against earlier 25% tariffs on imported steel and aluminium imposed by Mr Trump.

It had approved countermeasures which were to come into effect in stages from April 15, reported to include orange juice and coffee as well as motorcycles and boats.

Bourbon whiskey is reported not to have been included in the list, despite previously being targeted by the EU.

Mr Trump previously threatened a 200% tariff on EU drinks if bourbon was included, prompting significant concern for the Irish drinks sector.

The Irish Government welcomed the move by the EU to pause the measures.

EU Commission president Ursula von der Leyen had also previously offered a zero-for-zero tariffs deal on industrial goods, including cars, but Mr Trump has said that is not enough to satisfy US concerns.

The potential impact on the Irish pharmaceutical sector, which employs about 45,000 people, remains a particular cause of concern for Ireland’s Government.

Pharmaceuticals were exempt from the sweeping tariffs imposed on EU exports to the US earlier this month, but could be subject to further measures taken by the Trump administration.

The US trade secretary recently said US tech and pharmaceutical companies locating intellectual property in Ireland for tax reasons was “going to change”.

In addition, Mr Harris said the US administration is “still clear” that it intends to take action on pharmaceuticals, which would significantly affect Ireland.

However, he said the 90-day pause allowed room for negotiation, adding that there was “at least an openness to considering” a discussion on pharmaceuticals on the US side.

Mr Harris said he had told Mr Lutnick, who had previously said it was a “nonsense” that Ireland runs a trade surplus against the US, that the negotiations on the tariff pause should include a discussion about pharmaceuticals, rather than new taxes being imposed on the sector while engagement is continuing.

Total Irish exports were valued at 223.8 billion euros last year, with roughly one third going to the US.

Of the 72.6 billion euros in US imports from Ireland, approximately 58 billion euros relates to pharmaceuticals and chemicals leaving Ireland.

It had been suggested this could halve if Mr Trump had implemented a 20% tariff on the goods and the EU had responded in kind.