IDA Ireland said it needed to focus on what it could control and that it was challenging to make a “detailed assessment” of the impact of President Donald Trump’s tariffs for Ireland.
In a series of briefings, the investment agency said the immediate difficulty was likely to hit firms that worked with “tight operating margins.”
It said while geopolitics would become a bigger part of investment decisions, large multinationals would still seek market access, talent and proven expertise in countries like Ireland.
One briefing said clients were continuing to assess the impact of tariffs on their business but some indicated there was little effect so far.
It said all the IDA could do was watch developments and keep in close contact with companies both within Ireland and through their international headquarters.
The document said: “[We should] continue to advocate for improvements in Ireland’s relative competitiveness – a factor within our control.”
A slideshow prepared for a trade forum in April said that US companies accounted for 70% of the 300,000 people employed by IDA clients.
However, 85% of their exports were intended for markets other than North America.
“[Multinationals] consider a range of factors in deciding where to invest. Policy changes (eg on tariffs) [are] one part of a wider decision-making matrix with investments implemented over a multiyear timeframe,” the presentation said.
It said Ireland’s need to improve national competitiveness remains “critical”.
The presentation said the key factors in this were relative costs, planning, infrastructure delivery, talent development, as well as incentive offerings through tax or grants.
It said US companies still saw Ireland as their “entry point” to the European Union and to service wider global markets.
Ongoing engagement with firms showed that with the “prevailing uncertainty”, most were still assessing the impact of tariffs and preparing potential contingencies.
It said Ireland still had key attractions for investment including a stable business environment, access to a skilled workforce, and a “transparent, competitive tax regime.”
Another update for the Department of Enterprise from February said US trade policy would change the weighting of how multinationals made investment decisions.
However, it said that while tax or tariffs were one part of this, other factors like property prices, utility costs, and infrastructure remained just as important.
A note for the department said: “Cost of moving intermediate and final products are one part of wider factors considered in investment decisions”.
“In the medium-term, [a] mix of US policy changes across tariffs, tax, incentives and restrictions could impact future investment decisions,” it added.
Asked about the records, a spokesman said: “IDA Ireland sees no justification for the imposition of tariffs on EU exports. Tariffs are counter-productive and deeply disruptive. They drive inflation, hurting consumers on all sides”.
“We are fully supportive of the EU’s approach of engaging in substantive, calm, measured and comprehensive dialogue to reach negotiated solutions with the goal of achieving frictionless and mutually beneficial trade with the United States going forward,” he added.
Reporting by Ken Foxe
