US-China trade wars getting closer to Irish firms
Ireland and the rest of Europe are coming closer to being dragged into the US-China trade war, a leading trade consultant has warned.
John Whelan, a former chief executive at the Irish Exporters’ Association, said US multinationals such as Apple, which has large operations in Ireland and sources components before selling back into China, will be increasingly concerned that President Donald Trump plans to increase tariffs on a further $200bn (€170.5bn) of Chinese goods. China must decide whether to retaliate in kind.
Mr Whelan said the threat to firms based in Europe lies in the disruption of supply chains, as well as from the risk that Chinese firms would dump goods into European markets. “This is the largest so far [of trade war tariffs] and there will be consequences,” he said.
The scale of the tariffs threat leads to “a lot more serious international disruption”, said Mr Whelan.
“The Chinese will be duty bound to respond. There will be major difficulties across world markets and not just confined to the US and China,” he said.
The Trump administration was also deliberately attempting to downgrade the World Trade Organisation (WTO) as adjudicator of trade disputes, meaning “bad news” if the trade wars end up without a peacemaker, said Mr Whelan.
The EU will continue to recognise the WTO which means that any Brexit deal between the UK and the EU will not be undermined. Mr Whelan said the political turmoil in Britain means the UK government and firms were in no position to benefit from the US-China trade spat.
