Ireland braces for Donald Trump’s ‘Liberation Day’ tariffs

Tariffs are now expected to come into place as early as tomorrow, with experts predicting Ireland will be one of the worst-hit countries.

White House aides have given Mr Trump proposals for 20pc tariffs on most imports – but the detail is being held back for the president to announce. The Irish Government is waiting along with the rest of the world to see exactly what the fallout will be, with particular concern for the future of Irish-based US pharma companies.

Key ministers have been briefed on scenario planning exercises that have been carried out and on the worst-case scenarios. However, they are publicly adopting a “wait and see” approach to the looming challenges.

There is an acceptance that an economic shock is now inevitable, albeit over a period of time rather than in one swift blow.

Ireland’s response will be led at EU level. European Commission president Ursula von der Leyden has said there is a “strong plan” to retaliate.

In the Dáil, Taoiseach Micheál Martin said it was “too early” to say whether job losses will follow the announcement.

Mr Trump has for weeks trumpeted April 2 as a “Liberation Day” that will see dramatic new duties that could upend the global trade system. He will make his plan public during an event in White House Rose Garden at 8pm tonight (Irish time).

White House spokeswoman Karoline Leavitt said reciprocal tariffs on countries that impose duties on US goods would take effect immediately after Mr Trump announces them, while a 25pc tariff on auto imports will take effect on April 3.

The Republican president has already imposed tariffs on aluminium and steel imports, and has increased duties on all goods from China. But he has also repeatedly threatened to impose other tariffs, only to cancel or postpone them. However, it appears he will plough ahead this time.

“The president has a brilliant team of advisers who have been studying these issues for decades, and we are focused on restoring the golden age of America,” Ms Leavitt said.

According to reports, aides are considering a plan that would raise duties on products by about 20pc from nearly every country, rather than targeting certain countries or products.

The administration anticipates the new duties could raise more than $6tn (€5.56tn) in revenue that could be sent on to Americans as a rebate, the Washington Post reported.

Mr Trump has argued that American workers and manufacturers have been hurt over the past decades by free-trade deals that have lowered barriers to global commerce and fuelled the growth of a $3tn US market for imported goods.

Economists warn his remedy – hefty tariffs – would raise prices at home and abroad and hammer the global economy in a devastating trade war with other countries.

Signs are already emerging that the US economy is losing momentum due in part to uncertainty fostered by Mr Trump’s chaotic approach to economic policymaking.

Rattled investors have sold stocks aggressively for more than a month, wiping nearly $5tn off the value of US stocks since mid-February.

Behind the scenes, the Irish Government has looked to strengthen its position within the EU to withstand the significant impact that tariffs could have on the pharma industry, which Mr Trump has singled out for attention.

It has also sought to align itself with France, which could see its alcohol exports hit dramatically if the EU decides to pursue tariffs on US bourbon.

Mr Trump threatened to impose a 200pc tariff on EU alcohol imports if bourbon was targeted.

Tánaiste and Trade Minister Simon Harris has been engaging with his counterparts in a dozen EU member states who are concerned about their pharma sectors, with a view to operate as a bloc in the coming weeks.

The bilateral calls with ministers, including from Italy, the Netherlands and Denmark, looked to share ideas and decide what the next steps should be.

Mr Martin said: “The impacts are unclear. I hope there will be negotiations following the EU response, and we can navigate our way through this.”

But Mr Martin also widened the area of anxiety to include agri-food, and said another concern was “the pausing of investment decisions”, which was not quantifiable at the point but could have far-reaching effects.

“The landing zone will not be where we are today. We need to be upfront about that. The old order is essentially gone for now,” he added.

Finance Minister Paschal Donohoe looked to play down the likelihood of tax cuts in the near future in light of Mr Trump’s plans.