EU-US trade deal represents ‘substantial burden' for Irish businesses
The final terms of the deal were worked out during a meeting between European Commission president Ursula von der Leyen and US president Donald Trump at his Turnberry golf resort in Scotland on Sunday.
The deal will lock in tariffs of 15 per cent on most EU imports to the US, but prevent the prospect of an economically devastating trade war.
Ibec chief executive Danny McCoy said the agreement 'brings an end to a significant amount of uncertainty' for some businesses. However, he added that a 15 per cent tariff 'still represents a substantial burden for many industries'.
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'Sectors which rely heavily on the US market and operate within small margins, will once again be significantly impacted by an additional 5 per cent tariff, on top of what they have already had to absorb over the past several months and well in excess of the 1 per cent effective tariff which existing before April,' he said.
'Our message to the Government, as it was with the 10 per cent tariff, is that the most exposed sectors will require support similar to the interventions provided as a response to Brexit.'
Mr McCoy noted the finer details of the deal are still emerging. 'These details will be critically important for Ireland,' he added.
The European Commission, which is responsible for trade policy, had been scrambling to secure an agreement before an August 1st deadline. Mr Trump had threatened to triple import levies on nearly all trade coming from the EU if a deal was not done by then.
Speaking after the negotiations ended, Ms von der Leyen said the US had agreed to cap any future tariffs on pharmaceutical products at that rate.
Chambers Ireland chief executive Ian Talbot said certainty is 'critical for businesses' and that the impact of uncertainty over the past couple of months has been seen in terms of investment.
'While tariffs are never welcome news for businesses on either side of the Atlantic, reaching an agreement – however imperfect – is preferable to no deal,' he said. 'It at least allows companies to plan and adapt in the short term.
'Any clarity that can be provided – even if preliminary – lays the foundation for further negotiation and incremental progress on the tariffs that now exist.
'Efforts should be made to help businesses to adapt. The EU and Irish Government should work to create a fund to support viable businesses adapt to new tariffs and also to ensure potential arbitrage issues with Northern Ireland are clearly understood and addressed.'
BusinessEurope president Fredrik Persson welcomed the deal, which he said 'prevents a tariff escalation that would be extremely harmful to businesses and consumers on both sides'.
'We still need to examine the details and hope that a solution is soon found for important sectors that appear to be excluded from the deal,' he said.
'This will be critical to bringing the relationship to a more stable ground. Certainty and predictability are key for companies to invest and generate additional value on both sides of the Atlantic.'
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