Government hoping for negotiated settlement on US tariffs

By Cillian Sherlock and Cate McCurry, PA

Senior figures in the Government have expressed hope for a negotiated settlement to mitigate the impact of US tariffs, as the Taoiseach warned of the potential for global “recessionary trends”.

Ireland falls under the sweeping 20 per cent tariff imposed on most EU exports to the US which was announced by President Donald Trump on Wednesday and will come into effect in the coming days.

Taoiseach Micheál Martin said he is concerned about the impact on investments and jobs in Ireland, the EU and across the world, saying investors will keep their head “below the parapet” until the fallout over US tariffs settles down.

He said he deeply regrets Mr Trump’s decision, adding that there was “no justification” for the tariffs.

He also disputed how the US calculated the 20 per cent rate, which that istration said was determined by looking at tariffs and other trade barriers imposed on the US by the EU.

Mr Martin said the figures “do not reflect the reality of the situation as we see it”.

He said that Ireland and the EU will “weather this storm” in the face of the taxes, but added they will have an adverse impact.

That potential adverse impact was likened to the Great Depression by Public Expenditure Minister Jack Chambers.

He said: “The last time the scope or extent that this was tried globally in trading was in the early around 1930, which led to the Great Depression. In fact, the tariffs that are being imposed now are in excess of that.”

Mr Martin was among senior Irish Government figures to suggest the tariffs were an opening bid for negotiations.

He said: “The so far from the US is, our sense is, that negotiations is the preferred route forward.

“The next 48 hours will tell a lot.

“What I get from the President’s speech is very much sort of wanting to engage, and signalling a desire to engage, to negotiate a sensible settlement here.”

He also said that the EU and Ireland will “not be shy” in advocating for its interests as part of EU negotiations with the US.

“No country is going to be shy, and Ireland will not be shy in saying, in of our interests, but also strategy,” he said.

“I think the strategy is the key issue here, in of deg counter-measures that would have the desired impact of bringing people to the table and enabling negotiations.”

Meanwhile, US Commerce Secretary Howard Lutnick, a vocal critic of Ireland, said Mr Trump “is not going to back off” on the tariffs, which he described as a reordering of global trade.

Mr Lutnick told CNN the US president would only make a new deal with affected countries if they “change everything about themselves”, in a reference to tariffs and “non-tariff trade barriers” – in particular VAT.

European Commissioner Michael McGrath, who also attended a press conference in Dublin alongside Mr Martin, said that the EU is ready to negotiate with the United States.

“The current provisional estimate is that overall, around €380 billion of EU exports will be subject to the additional tariffs, that comprises of approximately 290 billion subject to the so-called reciprocal tariffs, 26 billion subject to tariffs on steel and aluminium, and €67 billion subject to US tariffs on cars and car parts.

“This would represent, overall, around 70 per cent of all EU exports to the US being subject to new tariffs that have been announced yesterday and indeed in recent days, which would result in around €80 billion in additional duties on EU exports to the United States.”

He went on to say that the EU is preparing for further countermeasures to protect Irish and EU interests and businesses if negotiations with the US fails.

Meanwhile, Tánaiste Simon Harris said there is a need for “maturity” in negotiations between the European Union and the US.

Speaking to reporters in Dublin on Thursday, Mr Harris said he took a “grain of hope” in Mr Trump’s stated willingness to engage with other countries.

“It’s absolutely clear President Trump wanted this big moment last night. He got it: Big charts and all – that happened in the Rose Garden, that bit is done.

“What we now need is the maturity of actually sitting down in a room and finding a way forward that’s good for the US economy, good for the EU economy, and that then ultimately is good for Ireland.”

Mr Harris said he was seeking a “negotiated way forward” but said the EU “has to respond if the US refuses to engage”.

He said the bloc cannot “stand idly by” and added: “We don’t want to be involved in tit for tat. We’d much rather be involved in talks.”

On Wednesday, Mr Trump announced a minimum baseline tariff of 10 per cent on all imports from all countries, with additional higher rates for some regions – including the 20% tax on goods from Ireland and the rest of the EU.

The 10 per cent rate is effective from April 5th while the “individualised reciprocal higher” rates will be implemented from April 9th.

Pharmaceuticals, which for a significant chunk of Irish exports, are currently exempt from measures – but Mr Trump has previously threatened tariffs on the sector and may yet make further orders. Mr Martin suggested the exemption may be down to the US underestimating the complications and impacts of taxing the sector.

During Wednesday’s announcement, Mr Trump said his istration was being “very kind” by implementing tariffs for most trading partners that were essentially half the rate of measures it had calculated was imposed on the US.

Ireland was not specifically mentioned in the address, but Mr Trump emphasised his response to the EU.

He said: “They rip us off, it is so sad to see, it is so pathetic.

“They charge us 39 per cent, we’re going to charge 20 per cent, so we’re charging them essentially half.”

The comments mean that the US istration considers that a “full reciprocal” tariff rate for the EU would be 39 per cent.

Mr Martin disputed this, saying that the figure cited by the United States to justify the imposition of tariffs “do not reflect the reality of the situation as we see it”.

“I think it was inevitable that some figures were going to be produced last evening to justify the position of tariffs,” he said.

He said that Irish companies should be encouraged to break into new markets and negotiate new trade deals between Europe and other big economic actors, including India and Indonesia.