Taoiseach Micheál Martin has said that the chief executives of pharma and medtech companies advised him “don’t overreact” to the proposed US tariffs.
“Different voices in the US administration also cautioned 'don’t go in with a bazooka', he told RTÉ radio’s Today with Claire Byrne show.
“To a certain extent, there has always been an expectation, despite all of the noise, that there would be a negotiated pathway. But we're far from out of the woods yet," he said.
"Clearly the bond markets was a key factor as well in terms of the timing of this decision because it was quite scary yesterday in terms of what was happening both on the bond market and in terms of stocks as well and then thirdly we're beginning to see some real concern on the Hill among Senators and Congress.
“There was a sense of a growing intensity in terms of that reaction and so I think all of those factors played into the decision yesterday although we should remind ourselves that it's reducing to 20 percent to 10 percent so there is still a tariff there and the 25 percent on cars and aluminium still stands. That's poor comfort to car manufacturers in Europe or indeed elsewhere.”
“I anticipate that Europe will respond positively in terms of saying, OK, we may hold back our countermeasures with a view to getting into negotiation with the US.”
Mr Martin added that it was his understanding that the “pushback” against tariffs on steel and aluminium would go ahead.
“But there's a bit of work to be done yet. There's a bit of consultation now with the EU Commission as to how we respond to this.
"But my sense is, and looking at President von der Leyen's comments this morning at our general position when I last spoke to her, was to try and get this on a negotiated pathway.
“There is now an opportunity to get this onto a negotiation path, which we can bring other things onto the table. Terms of non-tariff barriers or whatever else and if you could engineer a package out of this that would give us a safer more sustained landing zone in terms of trade and economic relationship that's the objective but we are a long way from that and I think there seems to be a renewed focus on the US side in terms of China and there was a clear sort of all out kind of economic, will I call it engagement or conflict in the last 48 hours.
“I think the real lesson from all of this, if one needed that lesson, is the interdependence of trade across the world. Even China itself over the last number of years was going for a more self-reliant policy two or three years ago maybe. It was very clear in the last year and a half, I mean, when I met foreign minister in China, he was very clear to me the inter-dependence of trade.
“And even though people are pulling back a bit from globalisation, even within Europe after Covid, you know, strategic autonomy concepts and all of that, nonetheless, you can't actually roll back globalisation as quickly as you might think because supply chains are very interconnected.
"We discovered that during the vaccine when it was explained to me like vaccine components, about 50 components to a vaccine and made in many different countries. So we're all connected and it's not a simplistic thing of saying. you know, just a comparison between the goods that you export to me and then I export.”
Mr Martin acknowledged that the “US side” were still saying “that they want to do something on pharma”, but he hoped that pharma would now be included in any negotiations.
“I do know that many of the American companies have been engaged with the administration, with the President and with Secretary of State for Commerce and others, making this very point that the pharmaceutical and indeed the medtech supply chain is a very complex one and that you and also access to medicines.”
