Monday, November 4, 2024

Trump or Harris? Irish business groups ready for both outcomes

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Irish business leaders will be among those glued to their screens as the US election results roll in over the coming days as whoever takes the seat in the White House wields a great deal of power over Ireland’s economy.

Ahead of the election, there are already fears that given a second term as US president Donald Trump will wage a massive trade war as he has taken aim at the EU in recent rally speeches.

Speaking at an event in Pennsylvania, Trump set out his thoughts on how the US will work with the EU when it comes to trade – and it his comments supports current economic sentiment in Brussels – that it could cost Europe billions.

“I’ll tell you what, the European Union sounds so nice, so lovely, right? All the nice European little countries that get together.

“They don’t take our cars. They don’t take our farm products. They sell millions and millions of cars in the United States. No, no, no, they are going to have to pay a big price,” he said.

EU leaders, for the most part, favour a Kamala Harris victory. If nothing else, her policies will be more predictable due to her work with the EU in the Biden administration. 

Ireland is no stranger to finding itself in Mr Trump’s line of fire. Back when he was president, he made it clear that he did not approve of Ireland’s corporate tax rates which have attracted a number of America’s largest companies.

Among the tax proposals that Mr Trump has spoken about during his current campaign is a reduction of the corporate tax rate for domestic manufacturing which he wants to reduce to 15% as part of his efforts to entice those large corporations to return to the US.

Mr Trump has also said that he would put a 10% tariff on goods coming into the US from other countries including Ireland.

US foreign direct investment (FDI) in Ireland last year totalled $491bn, according to the US State Department report, which also listed total FDI into the EU at $2.7trn, placing Ireland as the fourth highest-ranked investment location across the EU.

Given Ireland’s reliance on FDI, much hangs in the balance when America goes to the polls next Tuesday but, for its part, IDA Ireland is hopeful that decades of strong trade relations between the two countries will not be shaken.

“IDA Ireland’s mandate is to attract FDI into Ireland for the good of the economy – and in this regard we’ve been building our relationship with American businesses since we were established in 1949 – that’s over 75 years and 14 US presidents,” an IDA spokesperson said.

“Our focus is to remain closely engaged with our client companies ensuring that Ireland delivers on the capabilities and competencies required to enable further investment and growth.”

While Ibec said whatever the democratic outcome, it stands ready to work with the incoming administration no matter who is at the helm.

It said that, outside of the EU, the US is Ireland’s top trade and investment partner with the US accounting for 30.3% of Irish goods exports and 15.5% of Irish goods imports.

“Ibec and Irish businesses will continue to advocate for an open, rules-based, and positive relationship with the USA at both national and EU levels—one that minimises trade tensions, reduces business costs, and fosters enterprise and innovation,” a spokesperson said.

Should Mr Trump find himself back in the Oval Office, Irish businesses will have to wait and see if he, too, wants to continue a positive relationship between the two nations.

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