The Government has announced a new “market diversification” strategy to mitigate the impact of US tariffs on Irish businesses.
The action plan, developed jointly by the Department of Enterprise and the Department of Foreign Affairs, will offer exporting firms grants and other supports to explore new market opportunities outside of the United States.
It comes after the recent European Union-US trade deal, which includes a 15 per cent tariff on most EU exports to the US, a levy that is seen as particularly damaging to the food and drink sector here.
Minister for Enterprise Peter Burke said the plan was a response to the “huge uncertainty” hanging over the global trading environment, which left Ireland, as a small export-led economy, “exposed”.
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He said the plan should be seen as the Republic entering a new phase of trade development rather than a move away from the US market.
The US is the State’s largest trading partner, accounting for 30 per cent of our total trade (in goods and services) last year.
Mr Burke noted that his department’s €3.6 billion budget allocation under the revamped National Development Plan (NDP), which includes €600 million in additional money, would help fund the 100-point plan.
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Under the initiative, Enterprise Ireland will offer client companies market research grants of up to €35,000 to assess “the full impact of tariffs, gain market insights and develop mitigation strategies”.
There would also be a new market validation grant of up to €150,000 for companies to develop market entry strategies for new markets or new products.
As part of the plan, the Government will also review its “incentive offering”, across grants and tax which support existing businesses.
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It will develop a new “strategic air access fund” to introduce new long-haul routes into and out of the State while allocating more resources to support faster processing of legal migration visas and permissions.
Of the 950 Enterprise Ireland client companies that export to the US, the agency estimates that about 450 will be most affected by the new 15 per cent tariff.
Mr Burke insisted the Government would not be scaling back its planned budget spend in the face of Washington’s new tariff regime.
As part of the summer economic statement, Minister for Finance Paschal Donohoe announced the upcoming budget would be framed around a €9.4 billion spending and tax package.
“The budget arithmetic still stands,” he said, while hinting the Government’s growth projections could change in tandem with changing growth patterns in export markets, including the US and China.
“Ireland’s economic model is built on open access to global markets, underpinned by free-flowing trade and investment,” he said.
“That openness makes us agile, but it also means we are exposed to changes in global trade patterns and currency movements. This action plan is about ensuring we stay ahead of those changes, on behalf of the many innovative Irish businesses with high-value products to export,” said Mr Burke.
