The introduction of new US tariffs on the European Union (EU) could create a potential opportunity for Northern Ireland, a Belfast-based trade expert has said.
President Donald Trump said on Monday that tariffs on EU goods imported into the US could happen “pretty soon”.
The comment came hours before a new 10% tariff on Chinese goods came into effect.
China responded on Tuesday with a 15% import tax on US coal and liquefied natural gas, plus 10% on crude oil, agricultural machinery, pick-up trucks, and some sports cars.
While the US administration has confirmed a 30-day delay to new 25% import tariffs on Canadian and Mexican goods, European leaders have already warned they will “respond firmly” if President Trump enters a new trade war with the 27-member bloc.
“They don’t take our cars, they don’t take our farm products, they take almost nothing and we take everything from them,” President Trump told journalists on Monday.
But he added that trade issues with the UK “can be worked out”.
Mark O’Connell of the Belfast-based trade consultancy OCO Global said the Windsor Framework could present a unique dynamic if the UK manages to avoid the expected tariffs on European countries.
“Northern Ireland’s position within the EU Customs Union and UK internal market will be interesting,” he said.
“If different US tariffs apply to the EU and UK, there could be an economic opportunity to position Northern Ireland as an attractive base for EU exporters.
“This would make good on the promise that the region would enjoy the best of both worlds,” he said.
But, Mr O’Connell warned the scenario is far from certain, and could further complicate the post-Brexit trade arrangements in the north.
“The US might seek to clarify its stance on Northern Ireland goods and there could easily be confusion about what tariffs apply where, creating costs and red tape for local exporters and potentially importers.”
The uncertainty over new US tariffs led Guinness maker Diageo to scrap a key sales target on Tuesday.
The spirit giant said it is talking with the US Government over upcoming tariff policies that could “impact” its sales recovery.
Diageo said the confirmation over the weekend that tariffs will be imposed on Canada and Mexico, albeit delayed for at least a month, “adds further complexity” to its ability to predict future trading.
The group said its tequila and Canadian whiskey brands are expected to be particularly affected.
Mark O’Connell said while the US Government may achieve some short-term concessions, the medium and longer-term impact of the tariffs will create wariness among investors and increase US inflation.
He said exporters are already considering spreading their risk through new markets, new suppliers and partnerships with US-based firms.
