Sinn Féin spokesperson on Foreign Affairs, Donnchadh Ó Laoghaire TD, has called on the government to step up preparations for the potential impact of further US tariff increases on the European Union.
The Cork South Central TD was speaking after the signing of an executive order by US President Trump, on reciprocal trade and tariffs on a wide range of products and services.
Teachta Ó Laoighaire said:
“There is no question that Ireland faces significant potential challenges in the event of an escalating trade war between the United States and the European Union.
“The fact is that the industrial policy strategy of recent governments, and our failure to develop a strong enough indigenous sector to complement our strong foreign direct investment (FDI) sector, has left us uniquely vulnerable.
“This has not been helped either by the creation of various taxation loopholes that allowed some commentators to convey us as a tax haven. Successive governments have failed to build the infrastructure that we need to attract FDI without relying on tax incentives.
“I know that many people, particularly people working for American companies, will be concerned for the future at this time.
“It is important that the Irish approach is clear sighted, being realistic and honest about our vulnerabilities, responding accordingly, without panicking.
“It is evident that the position of the US government is liable to change at various times, and threats may or may not come to pass.
“If they do come to pass, the impact will affect future investment, but the immediate impact will be unclear.
“A number of things are required from the Irish Government urgently.
“Firstly, using our voice at European level to ensure that the sectors that most affect Ireland are central to any European negotiating policy. Clearly this includes pharmaceuticals, life sciences, food and drink, aircraft leasing, as well as tech and financial services, and the various other industries where Irish SMEs export to the US. Irish interests in this instance lie with ensuring that the EU functions as an effective economic bloc and presents as a united front.
“Secondly, the government must begin to plan for diversifying in terms of markets we trade with, and with a view to future trade missions. The United States, Europe and Britain will always be our main trading partners, for reasons of language, of culture, and long and deep relationships. But there is potential to deepen trade with countries in South East Asia, other emerging markets, as well as other countries that may be affected by tariffs, including major economies such as Canada and Mexico.
“Thirdly, the government must immediately begin preparation for supports for our businesses in the event of tariffs coming into effect. This can take the shape of some of the supports put in place for Brexit, while building on the learnings from it. We must make sure it is easily accessible and widely promoted as well as ensuring that businesses are supported in looking beyond English-speaking countries. This needs to involve education and training support, marketing support and potentially grant aid. The development of this programme needs to begin now so that it is ready to roll out as early as possible if tariffs come into effect.
“Fourthly, the government now needs to urgently prioritise investment in our infrastructure. The reality is that some of the reason we are so vulnerable is that there are huge gaps in our infrastructure. Our housing system is in crisis, we do not have a motorway between the second and third largest cities in the state, there is no rail link to our main airport, and our electric grid is totally inadequate.
“Trade wars are bad for everyone. I do not believe they will be in the interests of America, or of Europe, and the only way to win a trade war is not to be in one. We hope that cooler heads prevail.
“However, nothing can be taken for granted. Successive governments have left us uniquely vulnerable.
“It is essential that Minister Harris and the government act now to take all precautions necessary to protect Irish jobs.”
