Tánaiste Simon Harris has issued a warning to the US administration about the potential fallout from imposing tariffs on imported pharmaceuticals and microchips, reports RTE.
In a letter to US Commerce Secretary Howard Lutnick, Mr Harris raised concerns over two investigations launched by the US government, assessing whether foreign reliance in these industries poses a national security risk.
Mr Lutnick, a vocal critic of Ireland’s corporate tax regime—once labelling it his favourite “tax scam”—could ultimately recommend major tariffs on pharmaceuticals and semiconductors imported into the US, reports RTE.
In his correspondence earlier this month, Mr Harris noted that Ireland and the US share a “mutually advantageous economic bilateral relationship.”
He acknowledged that US foreign direct investment in Ireland is heavily concentrated in sectors such as pharmaceuticals and semiconductors, reports RTE.
Mr Harris highlighted that Ireland’s national security stance is “closely aligned” with that of Washington, expressing a willingness to work with the US on issues of economic security.
He then provided an overview of the relevant industries in Ireland, reports RTE.
Regarding pharmaceuticals, Harris pointed out that Ireland is largely focused on producing active ingredients rather than finished drugs.
“Ireland’s pharmaceutical sector is deeply embedded in that of the US. They are mutually reinforcing,” he wrote, reports RTE.
On semiconductors, he described Ireland’s industry as “extensive and technology-rich.”
The Fine Gael leader emphasised Ireland’s reputation as a premier destination for US investment, describing the country as “highly attractive” to American companies, reports RTE.
He credited this to Ireland’s “highly-skilled, flexible workforce” and “long-standing political and economic stability.”
He also highlighted Ireland’s position as a gateway to the wider EU market, which he described as one of the most “sophisticated and important global markets,” with a population of around 450 million.
Harris noted that about 60% of Irish pharmaceutical exports are destined for markets outside the US, reports RTE.
He stressed that Ireland-US supply chains have developed over decades and benefit from a “zero-for-zero tariff arrangement.”
He also emphasised the importance of strong regulatory cooperation between the two countries, especially the long-standing recognition of Irish pharmaceutical products by the US Food and Drug Administration (FDA).
“I strongly believe the Irish pharmaceutical sector supports the health of the American people,” he wrote, warning that tariffs could jeopardise future innovation and disrupt resilient supply chains, reports RTE.
He concluded his letter by saying: “I appreciate that you are undertaking these investigations due to national security concerns. Ireland’s trade with the US helps support resilient supply chains and diversification, and provides certainty of supply. Increasing costs on two strategic sectors that face growing competition from other regions will not aid in supporting US interests,” reports RTE.
Minister of State for European Affairs Thomas Byrne warned that President Donald Trump’s threat to impose a 50% tariff on EU goods would “effectively stop trade” between the EU and US.
Speaking on RTÉ’s This Week programme, Byrne said: “I think it would effectively stop trade, if that were the case, because I don’t think people would be willing to buy goods at a 50% tariff, and of course, there would be EU retaliatory measures,” reports RTE.
He called the possibility of a US-EU trade war “clearly very concerning” and warned it would be “very damaging for everybody.”
However, Minister of State John Cummins argued that a trade war is not inevitable.
“We have seen a shift in (US) policy positions throughout the last number of months. It’s far too early to say that,” he said on RTÉ’s The Week in Politics, reports RTE.
Cummins urged calm and continued dialogue: “It’s time for cool heads to prevail and negotiations to continue, as tariffs are bad for consumers, and bad for business.”
He also advocated for EU market diversification and more free trade agreements such as CETA, reports RTE.
Social Democrats TD Rory Hearne said finalising a trade deal with the US is “extremely difficult” due to what he called President Trump’s “completely erratic” behaviour.
Hearne warned that certain interests backing Trump oppose EU regulatory standards, especially those applied to corporations like social media giants, reports RTE.
He claimed Trump “has it in for” the EU, and said the Irish Government should act urgently to reduce its economic reliance on US multinational corporations.
He called for major investment in domestic research and development to drive that shift, reports RTE.
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