US retreats on trade as EU backs UK on Russia

Donald Trump’s move weakens Ireland’s line of attack on proposed tax on digital firms

US president Donald Trump embraces Taoiseach Leo Varadkar at the White House during their St Patrick’s week meeting. File photograph: Win McNamee/Getty Images

US president Donald Trump embraces Taoiseach Leo Varadkar at the White House during their St Patrick’s week meeting. File photograph: Win McNamee/Getty Images

 

Donald Trump’s US administration has exempted the European Union from controversial import tariffs, averting a possible transatlantic trade war but also weakening Ireland’s line of attack against a proposed digital tax.

In the run-up to the two-day meeting of European Union leaders in Brussels, the Government strongly argued that the timing of the EU digital tax, mooted by France, would inflame tensions with Mr Trump as he embarked on the most protectionist move of his presidency.

On Capitol Hill, Mr Trump’s trade representative Robert Lighthizer told a US Senate panel that the president had decided to “pause” import duties against the EU pending further talks.

As the potential for strained relations with the US dissipated, focus at the summit turned eastward.

In a show of unity, EU leaders, including Taoiseach Leo Varadkar, rallied in support of the UK in the diplomatic standoff with Russia over the nerve-agent attack on a former Russian spy in Salisbury.

The European Council will conclude in a final text that the chemical attack “continues a security threat to us all” and that “member states will co-ordinate” their responses.

Speaking to reporters as he arrived at the summit, Mr Varadkar said that on issues of security with Russia, it was “very important that we stick together”.

“What happened at Salisbury was loathsome and reprehensible; and we’re going to stand right beside the UK on that issue,” he said. “An attempted assassination or a chemical attack, no matter who does it, is something that we’re going to . . . condemn outright.”

Mr Varadkar stopped short of saying that Ireland would answer a call from British prime minister Theresa May for EU-wide expulsions in retaliation for the attack.

He side-stepped a question on whether Dublin would also be expelling Russian diplomats. Another EU state, Lithuania, signalled that it was contemplating deportations.

A source said the Government would, unlike the UK, wait for the findings of an investigation by the Organisation for the Prohibition of Chemical Weapons into the attack before saying whether it believed Russia was responsible.

On Brexit, another topic of much debate in Brussels, Mr Varadkar raised the possibility that the details of the “backstop” guaranteeing no hard border in Ireland could go down to the wire.

He said that a deal on the emergency option conceded by Britain this week may not be reached until the October deadline for agreement on the Brexit treaty, and not as hoped by the next EU summit in June. “I would rather have the right deal in October than any deal in June,” he said.

In a meeting with Mr Varadkar on Thursday night, Ms May reassured him of her commitment to the December agreement that contained the “backstop”.

A spokesman for the Taoiseach said the leaders looked forward to talks next week at official level in Brussels on the Border. And that they would discuss Northern Ireland again after Easter.