US confirms 15pc tariff to include pharma, but more ‘horse trading' yet to come

Irish Independent

30-07-2025

A fact sheet published on the White House website yesterday showed the tariff rate would apply to pharma­ceuticals and semiconductors.
The clarification should bring an end to the confusion that has surrounded this aspect of the EU-US trade deal, which was finalised by US president Donald Trump and European Commission president Ursula von der Leyen on Sunday.
The multinationals based here, such as Pfizer and Eli Lilly, export about €40bn of pharma to the US each year.
There is still uncertainly over many key issues, with discussions continuing on whether products such as wine and spirits will be exempt from the 15pc rate.
US commerce secretary Howard Lutnick cast many of the issues surrounding the US-EU trade pact as still up for discussion, saying there was 'plenty of horse trading left to do'.
EU Commission trade spokesperson Olof Gill described the framework trade agreement yesterday as a 'political commitment', rather than a legally binding document.
He said that Brussels and Washington were now working on a joint statement, which will be treated as 'an agreement in principle', that will give the bloc a 'political road map to where we take it from here'.
'Both sides are working very hard now to get the details of that signed up,' he told RTÉ Radio 1. 'We're hoping to do that before the deadline of August 1 set by the US.
'What we're talking about here are political commitments. This joint statement I mentioned isn't a legally binding document. These are commitments.'
In relation to agriculture and the fact that Northern Ireland and the Republic have two different tariffs applied to their goods, he said details 'can be worked out'.
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'We're not at the end of the process here, we're at the start of the process,' he said.
There is still scepticism that the EU will be able to fulfil its promise to buy $750bn (€650bn) of American energy over three years. The bloc's energy imports from the US were less than $80bn last year.
The fact sheet published yesterday by the US stated: 'As part of President Trump's strategy to establish balanced trade, the European Union will pay the United States a tariff rate of 15pc, including on autos and auto parts, pharmaceuticals and semiconductors.'
The sectoral tariffs on steel, aluminium and copper will remain unchanged, with the EU continuing to pay 50pc.
Deal creates enormous opportunities for American-made and American-grown goods
The fact sheet claimed that the 'colossal' trade deal will enable American farmers, the fishing industry and manufacturers to increase their sales to the EU, thereby reducing the trade deficit.
It also said the EU will remove all tariffs on US industrial goods that it imports, which creates 'enormous opportunities for American-made and American-grown goods to compete and win in Europe'.
In terms of US food imports to Eur­ope, the fact sheet said the two sides will work together to address non-tariff barriers that affect trade.
These barriers are likely to include certain food standards that are applied to beef and chicken, and 'streamlining requirements for sanitary certificates for US pork and dairy products'.
Mr Trump's administration is conducting a separate investigation of pharma imports to America to assess if over-reliance on them is a threat to national security.
The expectation is that the results of this investigation, expected next month, will lead to a hefty tariff on pharma.
Mr Trump has threatened a levy of up to 200pc as he attempts to strong-arm US pharma companies to re-shore their manufacturing operations in America.
Niall Cunneen, associate partner for Ireland and the UK at global consultancy group Sia, described the White House confirmation of the 15pc tariff rate as a 'blow to Ireland'.
'This is a sector that underpins roughly 20pc of our GDP and employs tens of thousands of people in high-value roles across the country,' he told the Irish Independent.
'The idea that this could be swept up in a political deal, without legal guarantees or clear carve-outs, is concerning.'
'If the US follows through with additional pressure under the Section 232 investigation, we could face a slow erosion of future investment and a lasting effect on long-term planning from multi­nationals based here.
'We're now looking at a future where one of our most important industries is directly exposed to US political cycles and trade tactics.'
Public Expenditure Minister Jack Chambers said yesterday that the risk of a 30pc tariff would have been 'severely damaging for the Irish economy' and said the 'stability and the predictability of what's being set out here gives ... certainty to the business community, and gives certainty to investments'.