Delay on counter-tariffs a positive amid 'severe threat' to Irish whiskey industry, MEP says
James Cox
The EU's decision to delay counter-tariffs on US bourbon is important amid the threat of a 200 per cent tariff on European alcohol imports, according to an Irish MEP.
In an interview with BreakingNews.ie, Fianna Fáil MEP Barry Cowen discussed the "severe threat" to Ireland's whiskey industry.
"The US administration's proposed 200 per cent tariff on EU alcohol imports poses a severe threat to European business, particularly Ireland's whiskey industry.
"And the proposed 50 per cent counter-tariff on US bourbon does not help our case for the US to never implement it. The EU has agreed to delay any counter-tariffs until mid-April. In the meantime, it'll consult with member states and MEPs on what form they should take in relation to the counter proposal.
"I've written to the trade commissioner and our own commissioner Michael McGrath, calling on them and the Commission to remove bourbon from the EU countermeasures.
"Maintaining a a zero for zero tariff status between the EU and US on alcohol is essential I think for industry stability, especially when you consider Irish whiskey exports."
Mr Cowen said it made more sense to look for an agreement before escalating the situation with counter-tariffs, which the EU have delayed until mid-April.
The mantra of Trump doesn't have to be matched by the impact.
"Exports to the US have seen significant growth with a value of €420 million annually. Whereas we contrast that to bourbon, imports to Ireland are worth just €8 million. That underscores the disproportionate impact of retaliatory tariffs. The EU exports three times more spirits to the US than it imports.
"This means escalation is a direct threat to European producers. So we must make it clear that there's no strategic benefit in targeting bourbon whiskey, and any failure to act would harm Ireland's economy, its brands and jobs, and that's my prerogative and responsibility, which my colleagues and I are taking very seriously.
"The comparison is plain to see, and the impact on us is far greater than it would be on them. We have a lot more to lose than they have.
"We've been highlighting this fact at EU level, as government representatives and others have been to the US administration, and we continue to do so. These tariffs can negatively impact us both.
"There are options and opportunities and an openness, on the part of ourselves at least, to get into serious dialogue and reach an agreement whereby the mantra of Trump doesn't have to be matched by the impact.... not only here, but obviously to his own country, which is coming down the track too."
As a member of the European Parliament International Trade Committee, Mr Cowen said he has been busy advocating for Ireland's interests at EU and US level.
"The EU exports €150 billion more in goods to the US than it imports.
"However, the services this money supports are mutually beneficial. Irish companies support 120,000 jobs in the US. These jobs are particularly vulnerable to sudden shifts in American trade policy, and anti-escalation tariffs would disrupt established economic ties and negatively impact Irish businesses.
"It means fostering diplomatic engagement where possible with Washington, ensuring all decision makers, whether it be in the Senate or in the Congress, that they understand the importance of stable trade policies that reinforce our role as a key economic partner for the US.
"If you look at where we do trade, we do a third of our trade within the EU, a third of our trade with the UK, and the final third is international, rest of the world countries, including the US.
"It's pivotal that we have transactional trade policies and trade agreements with those blocks in order to ensure that we have avenues open for our markets, to create jobs and build on the success we've had in relation to our trade.
"We've seen our beef exports increase by 6 per cent year on year to target countries, prices up and that accrues to the State in relation to revenue, but also offers opportunities to win trade win allegiances and alliances with countries that can only help them benefit us in the event of us being in a situation whereby we lose trade at US level."
Trump tariffs
There are fears about US companies based in Ireland being forced to uproot due to tariffs, which were only exacerbated when US president Donald Trump name-checked pharmaceutical companies in Ireland while speaking in the White House this week.
Mr Cowen said he is confident Ireland will maintain its role as a key location for US businesses, particularly due to our highly-skilled workforce and the fact that Ireland provides a gateway to Europe.
"I see it with my own constituents. I see the investment by the likes of Dexcom in Athenry where 1,000 jobs are being created, where €300 to €400 million is being invested by a US company. It's a base to trade their goods into the EU.
"That's an indication of the strength of our base, of our location, of our language, of our workforce, and our capacity to penetrate at the European market.
"The US recognise and appreciate that, and we have to build on that.
"There's some solace and something to be taken from the process that has evolved only in the last week or so in relation to the whiskey tariffs whereby the EU has said it will pause tariffs until April.
"It may well be in a position to revive its commitment in relation to the bourbon tariff. However, this would impact positives in relation to the trade that exists with the whiskey sector not only in Europe, but specifically from our case, a burgeoning trade that exists presently in from Ireland."
Many of those American companies are based in Ireland because of its proximity to Europe, because of its springboard nature to meet that market.
Mr Cowen added: "I've heard the pharmaceutical industry and its representatives respond to those threats by saying it has the ability to withstand them and to emerge from them. And as I said, many of those American companies are based in Ireland because of its proximity to Europe, because of its springboard nature to meet that market."
However, he said it is important to strengthen "domestic competitiveness" and trading relationships with other countries amid the risk of a US-EU trade war.
"We can't assume that negotiations and consultation will result in positive outcomes. Trade policy is essential, but we have to strengthen our own domestic competitiveness amid such external economic pressures. As a country, we have successfully attracted foreign direct investment and will continue to do so due to our skilled workforce, our status and our strong regulatory framework.
"The challenge remains in infrastructure and energy security. That could impact our ability to sustain that economic success. So it's imperative that we stick to the programme for government commitments to improve our energy capacity, improve our security, and win European support for pan-European projects.
"It can develop the potential we have off the west coast, not only to power ourselves and the regions that need it most, but obviously to make an impact into the European market, which unfortunately continues to have a dependency on Russian gas. And anytime when we move, as we move away from that, costs remain very high and we have the potential to impact on that for ourselves and for Europe.
"The doomsayers never thought we would emerge from Brexit and find alternative markets in the way in which we did. That was down to the hard work and the competitive nature of Irish business and its ability to adapt and to win new business.
"We can do that again, but government and business and the industries all have to work in tandem and I'm glad to see that the Government has a taskforce in place that has met already."
