GOVERNMENT, BUSINESS LEADERS and unions are meeting to strategise Ireland’s response to US President Donal Trump’s imposition of tariffs, which have launched a stock market slide and sparked recession fears.

Taoiseach Micheál Martin said this morning that the crisis is “different to Covid” and warned: “This could be for the long haul.”

Asked about a Labour Party suggestion for a new short-term work scheme to keep workers in affected firms upskilled and employed during what is likely to be a tumultuous period, the Taoiseach emphasised that there will be many demands on the resources of the state.

“Anything we do has to be targeted and has to be future-oriented. We need to keep our resources to invest in water, in energy, in housing, in public transport,” the Taoiseach said on RTÉ Radio 1′s Morning Ireland.

“This is a very early stage of a process here. But equally, we have to really pivot very strongly now to reshaping the economy in the light,” he said.

The Taoiseach talked up the prospects of negotiations with the US but acknowledged that it “remains to be seen” whether a deal can be struck.

“This seems to be how this was to play out – the announcement of high tariffs to be followed by negotation,” he said.

He said the European Commission remains ready to deploy a range of countermeasures.

Government leaders in Dublin today are meeting the US trade forum, which will focus on the fallout of the tariffs that Trump has imposed on most of the world. The potential for taxes to be placed on the pharma industry remains a key concern in Ireland.

It is expected that discussions at today’s trade forum, including Irish business leaders and economy experts who are based in the US, will focus on the threat that these tariffs and future duties pose to the Irish economy.

Tánaiste Simon Harris, who will chair the meeting in his capacity as trade commissioner, is expected to tell the group that a detailed plan must developed within six weeks in order to guide Ireland through the period of uncertainty.

The Taoiseach said it is expected that instability in the economy will be in place for a prolonged period of time.

“My biggest concern right now is sentiment is going to go down. Investment decisions are being paused. Ireland is a small, open economy. We want growth in the world economy – that will impact us quite significantly as well, not just the tariffs,” he said.

Martin said that the engagement he has been having with multinationals in Ireland suggests that the companies want to remain in the country, but questions still remain over the length of time that that can remain sustainable.

He added that steps will need to be taken to redevelop the Irish economy, including taking steps to prioritise the protection of small and medium businesses located here and provide them with better access to the EU single market.

Harris today will confirm the first steps on this redevelopment are being taken, as enterprise minister Peter Burke has instructed his department to bring a specific paper on competitiveness in Ireland and the EU to the economy sub-committee next week.

It’s understood the Tánaiste will also tell the forum that “significant uncertainty” remains in relation to whether further tariffs will be imposed on industries such as pharma, but he will add that “there is always time to strike a deal”.

European Trade Commissioner Maros Sefcovic confirmed that he will today attempted to make contact with his US counterparts in order to begin the process to start negotiations with Washington.

Trump last night suggested that he is open to talks, but there is an understanding at government level that the US president has a limited interest in engaging with the European institutions, such as the Commission, directly.

The forum will also hear today that if Ireland was ‘outside’ of the EU, it would have been hit with a tariff of around 35%.

Northern Ireland

In relation to Northern Ireland, the Tánaiste is expected to tell today’s forum that there is “immediate North-South challenge” as a direct result of the US decision to impose a 10% tariff difference between EU and UK.

Micheál Martin said this morning that clarity still has to be sought around how trade between the north and the Republic can continue into the future and how Irish companies located in the south can be protected.

He explained that the Windsor Agreement – accepted after Brexit, which gave Northern Ireland access to the EU and UK markets – has certain provisions for companies in the North, but not in the Republic.

He said discussions will take place in order to explore ways that SMEs located in the Republic can be assisted.

Taoiseach meeting with unions

The Taoiseach will chair a meeting of the Labour Employer Economic Forum (LEEF), attended by key business and union representatives, to discuss tariffs.

The meeting which will include representatives from IBEC, CIF, Chambers Ireland, ICTU, SIPTU, Forsa and the INMO.

The Tánaiste, Minister Jack Chambers, Minister Paschal Donohoe and Minister Peter Burke will also attend , along with senior officials from their departments

The LEEF has been a key forum for discussions between government and representative bodies during periods of economic uncertainty, particularly Covid-19 and Brexit.