The former Irish Ambassador to the US, Dan Mulhall, has stated that the European Union “has a lot of cards to play” in negotiations with the US regarding tariffs.
Speaking on RTÉ radio’s Morning Ireland, Mulhall said: “American companies are very active throughout Europe. They have a privileged position. They make huge profits from the European single market.
"Remember, the trading relationship between the EU and the United States is the biggest one in the world. It's almost a trillion dollars in two-way trade. And that's just in goods.
“And then there's a services trade. So the services trade is a big plus card for the European Union, because that's an area where the United States has a surplus with the European union. And, that's a card that they can play I think effectively to try to leverage a deal that will be beneficial for both sides.
“Obviously they have to give something to the United States to sweeten the deal for them, but I think it'll be worth making some concessions on the part of the European Union and I'm sure the Commission already has a list of things that they could offer the Americans by way of concession.
“You need to go into these negotiations hoping that both sides can come out and declare victory and Donald Trump will declare victory, he will come out of those negotiations, but whatever the outcome is, he'll come out and say, ‘this is a great deal and only I could have made this’.
"And that's the kind of outcome that he's looking for, and that kind of an outcome would be okay with me too, because as long as we get a deal that doesn't wreck the global trading system, that doesn’t destroy transatlantic trade or put it in shackles, that would be a good day for Europe, for the United States, and in particular for Ireland because after all we are more exposed to transatlantic trade than any of our European partners are in percentage terms.”
Mr Mulhall added that he was “fairly optimistic” that a deal could be “wrapped up” within the 90 day pause.
“He's had this kind of edge-of-the-cliff moment, and he's backing away from it. So why would he now go back to imposing tariffs and creating further turbulence?
"I think perhaps a lesson may have been learned, and this may have been the only way in which Donald Trump's mind could have been changed, that he started to be shown the real consequences of what he was doing.
“Of course, it's possible that he will decide to go after the pharma industry and impose tariffs on pharma. But, you know, I think there's a reasonable chance that the pharma tariffs will be paused and they will become part of this general negotiation between the European Union and the United States, which I believe ought to be successful because the EU is a very experienced trade negotiator.
"I know and like Maroš Šefčovič, who's a very good and skilful politician, and I think he and his team will be able to put some proposals before the Americans that hopefully will lead to an agreement.”
However, Mr Mulhall cautioned that “this is not an ideal situation".
"This is a difficult set of circumstances, but at least we have moved back from the brink and for example if you look at say Irish whiskey exporters, they'll be very relieved today because the differential that would have been there between Irish whiskey and scotch whisky and even between northern Irish whiskey, and whiskey from the south, that's now gone for the time being.
“Now okay there's still a 10 percent tariff but that's more manageable than the 20 percent tariffs. So, this is a good day for our economy, for the prospects, for some kind of rapport between the EU and the US developing.
"Last week it looked as if we were headed for a serious clash of heads between the European Union and the United States.
"That clash has now been deferred for three months, and we must hope, keep our fingers crossed, that Šefčovič and his team will be able to come up with the goods and produce the kind of agreement that will put things back to the way they were before the so-called Liberation Day.”
