Ireland has been identified by the White House as one of a group of countries running an unfair trade surplus with the United States, as President Donald Trump takes his first steps towards revising American tax and trade policy.
Mr Trump signed two executive orders on Friday – one announcing a study into unfair trade practices and the second ordering the collection of duties from countries selling products into the United States at low prices.
Mr Trump signed the orders following a meeting in the White House on Friday with representatives of leading US manufacturing companies.
Announcing the new executive orders, press secretary Sean Spicer said that Mr Trump had been elected to do “everything he can to support American workers” and to end unfair trade practices “once and for all.”
“This is the first time in modern history a president has ordered a review of reasons for the trade deficit,” he said, arguing that the study would allow the administration to deal with America’s “large and persistent trade deficit,” the largest of any developed country.
Speaking to reporters ahead of the announcements, commerce secretary Wilbur Ross said Mr Trump had said the study would focus on countries that have a "chronic" trade surplus with the United States.
Mr Ross, the billionaire who tripled the value of his investment in Bank of Ireland after investing in the bank at the height of the financial crisis, named Ireland as the country with the fifth highest trade surplus with the United States, with the country registering a $36 billion surplus with the US last year.
China topped the list with a $347 billion surplus, followed by Japan with $69 billion, Germany with $65 billion and Mexico with $63 billion. A trade surplus occurs when a country exports more than it imports from another country.
Mr Ross said the “systematic” analysis, which will be completed in 90 days, would examine the causes of the United States’ trade deficit on a “country by country, product by product” basis. The study will then form the basis of future policy, he added.
While noting that there were specific reasons for the high level of exports from some countries; much of Canada’s exports to the United States reflected oil sales which are required by America, for example, he said the study would ascertain the reasons behind the imbalances.
It is understood the multinational pharmaceutical industry accounts for much of Ireland’s high level of exports to the United States.
The pharmaceutical sector, and the retail price of drugs, were issues discussed by the Taoiseach and Mr Trump during their bilateral meeting at the White House earlier this month.
Mr Ross said today’s announcements were “designed to let the world know that this is another step in the president fulfilling his campaign promise”.
Peter Navarro, the director of Mr Trump's National Trade Council, said that "for the first time, we're looking comprehensively at the source of what has been a large and persistent trade deficit that has contributed to job losses, the loss of our manufacturing base and other things".
Mr Trump has pledged to upend decades of US trade deals and tax policy in a bid to bring back jobs to the United States.
