Ireland will use relationship with US to talk down trade war – finance minister

The Irish government will use its relationship with the US to help talk down the prospect of a trade war with the EU, its finance minister said.

Paschal Donohoe said that the EU-US trading relationship had made “both of those economies richer over time” and a trading dispute “will cause harm to us all”.

Ireland is one of the most vulnerable European countries to EU tariffs threatened by US President Donald Trump.

Irish ministers have pushed for reaching a compromise that would avoid tariffs and a trade war and are sending nine government members to US cities for St Patrick’s Day as part of a charm offensive.

Asked about the so-called special relationship Ireland has with the US, Mr Donohoe said Ireland will be “using that voice” to highlight what is of benefit to Ireland and Europe.

He said they would repeat EU Commission vice-president Maros Sefcovic’s comments that tariffs are “economically counterproductive” for the EU and US, particularly given “integrated” supply chains and investment ties.

“While of course, Europe will have to respond to any measures that are taken through tariffs that adversely affect our exports, we are better off engaging with each other and negotiating with each other to try and reach outcomes that are mutually beneficial.

“We’ll be using that voice to back up what Commissioner Sefcovic says, which is that while, of course, the initiation of tariffs have the ability to do such harm to all those involved in trade, and Europe will have to respond back, at the same time, we should be looking at dialogue and negotiation to avoid trade disputes and practices developing that will cause harm to us all.

“We will be using our voice to make the case for trade to be mutually beneficial, talking about how Irish companies are employing Americans, Irish companies are investing in America, and that is to the benefit of both of us. So there’s great symmetry between both messages.”

Mr Trump has expressed dissatisfaction with the amount of US goods bought by the EU compared to EU goods bought by the US.

As he imposed since-suspended tariffs on Mexico and Canada, Mr Trump said of the EU: “They don’t take our cars, they don’t take our farm products, they take almost nothing and we take everything from them.”

Ireland’s deputy premier and foreign affairs minister Simon Harris said recently that the EU can buy more goods from the US to avert a trade war.

He said on Friday: “There are opportunities, I believe, for the EU and Ireland to do more business and more trade with the United States, and therefore address some of the deficit that exists in relation to goods.”

Mr Donohoe, who is president of the group of eurozone finance ministers, said that balancing trade with the US “in more natural ways” could be considered.

“When any massively, globally significant economy like the United States of America indicates that they’re considering tariffs – and in some cases, has actually applied them – of course, policymakers in other parts of the world will have to respond back,” Mr Donohoe said on Wednesday.

“If there are opportunities for that to be balanced in more natural ways through the purchases of goods and services from America, then that’s something that could be considered.

“It is why I hope, as we look at all of the different things that we are dealing with at the moment across the world, we can still work together in the weeks and months ahead to avoid a very significant trade dispute that would have, I believe, a really big effect on the performance of the global economy and on big trading regions and countries within the world economy, like America and the European Union, and that’s the work we’re going to try and do with President Trump’s administration.”

Asked what products Ireland and the EU would start buying more of from the US, Mr Donohoe said: “I couldn’t identify at this point what the potential products could be.”