A proposed trade framework between the European Union and the United States was “tantalisingly close” to being finalized before a letter from President Donald Trump introduced the threat of a 30% tariff on EU imports, according to the Tánaiste, reports RTE.
“A framework agreement was tantalisingly close, even in recent days and I think that’s why, when the letter came, there was surprise because genuinely from a European perspective there was an expectation that a deal was in there,” Simon Harris said, reports RTE.
While addressing a trade summit, Mr Harris noted that “there was and can I say remains absolutely space for a deal,” pointing out that targeted tariffs on sectors like pharmaceuticals were unlikely to be incorporated into such a broader framework.
Mr Harris also remarked that Ireland is “now at a moment of major economic challenge”, reports RTE.
He described the potential impact of a 30% tariff as “extraordinary”, stating that Ireland is working closely with EU partners to brace for “every eventuality”.
“There were moments last week where I believe it was almost palpable that there was an agreement nearly in place, and really what needs to happen in the hours and days ahead is a renewed effort to arrive at an agreement that can protect jobs, can protect economic stability in Ireland, in Europe and in the United States,” reports RTE.
The Tánaiste suggested that the tariff threat from Mr Trump was intended to exert negotiating pressure and push for trade deals with other nations.
“We also have to be honest with people, and we have to relay to the public what we’re hearing from our interlocutors in Brussels … if you arrived in a scenario where there were 30% tariffs, the impact to that is extraordinary. It would completely and utterly alter the trading relationship between Ireland and the United States. You’d go from a situation at 10% tariffs where you’re seeing a slower rate of new job growth, to a situation of 30% where inevitably, you’ll be seeing job losses,” reports RTE.
On the specific risk to the pharmaceutical sector, Mr Harris stated that he would host a meeting the next day through the Irish Embassy in Washington with several U.S. pharmaceutical companies to hear their views.
“The EU and the US have huge potential to work together in pharma, but were the US to decide to do something that is ill-conceived or ill-thought out on pharma, I think that would have very significant consequences, not just for Ireland, but also for patients across the Atlantic and also for global supply chains. This is objectively a moment of major economic challenge; we’ve got to pull together, we’ve got to work together, we’ve got to find a way through this,” he said, reports RTE.
Minister for Public Expenditure Jack Chambers expressed concern that a 30% tariff imposed by the U.S. would cause major harm to Ireland’s economy.
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During an interview with RTÉ’s News at One, he described the danger as “exceptionally high”.
“The threat of a 30% tariff on EU imports into the US would be really serious in the context of the Irish economy, it would have a severe impact on growth, it could result in significant job losses and would really disrupt the international trading environment upon which the Irish economy is built,” he said, reports RTE.
“That is a significant risk in the context of budgetary planning, and that’s why fiscal restraint will be really important, particularly as we plan for Budget 2026. Within that, we need to see a moderation of current expenditure and also, we need to significantly address the infrastructure deficit that exists within the Irish economy. That’s why, notwithstanding the broader economic risks that exist as a Government, we’re really clear on the need to utilise the review of the National Development Plan to really drive investment and transform infrastructure in our economy. We’ll set out that ambition next week in the measures that we take to support the advancement of transport, energy and housing infrastructure in particular,” reports RTE.
Mr Chambers remarked that Mr Trump’s proposed 30% tariff had “changed everything”.
“It changes everything in the context of the trading relationship between the EU and the US. We know from the Department of Finance that a 10% tariff would slow jobs growth and would also impact overall growth in the Irish economy. 30% would have much more severe and deep consequences for Ireland and for jobs within Ireland, and we would have to assess that in the context of our medium-term fiscal planning,” he added, r r
He also noted that it remains uncertain whether a compromise such as a 10% tariff could be agreed upon.
“30% has been outlined by the US. We support the negotiation process that’s underway with, and is continuing between, the EU and the US. We’re constantly engaged with the European Commission on trying to ensure a mutually beneficial outcome, but 30% would create serious and damaging consequences, but the the outworking of the deal is unclear at this point,” he said, reports RTE.
Labour TD George Lawlor expressed concern that a 30% tariff on EU goods by the U.S. could potentially “end trade” between both sides.
Speaking to journalists at Leinster House, Mr Lawlor cited the involvement of EU trade commissioner Maroš Šefčovič in raising the matter.
He added that “30% tariffs have not been modelled” and that the topic is creating “a lot of unease”, reports RTE.
Peadar Tóibín, leader of Aontú, cautioned that Ireland is teetering on the “precipice of the biggest economic crisis facing this country since the banking crisis”.
Mr Tóibín warned that the trade conflict could “potentially destroy tens of thousands of Irish jobs”, reports RTE.
“Ireland is one of the most exposed countries in the EU to the US tariff war,” he said
“Last year we exported €72.6bn worth of goods to the US,” reports RTE.
He argued that some other EU countries, despite being “less exposed than Ireland”, seem to be playing a larger role in shaping the EU’s approach.
He stressed the need for Ireland to actively use its position and connections with the U.S. “in relation to our national interests,” reports RTE.
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