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Irish Times
34 minutes ago
- Irish Times
EU-US tariff negotiations have ‘number of weeks' to go, Donohoe says
Negotiations between the European Union (EU) and the United States look like they have a number of more weeks to go before a tariff deal is agreed, Minister for Finance Paschal Donohoe has said. EU negotiators have been making a push to exempt certain sectors, such as aviation and spirits, from blanket US import duties , with encouraging indications of headway, one source briefed on the discussions said. Those carve outs would be welcome news to the Government, as a win for whiskey distillers and the aircraft leasing industry. A deadline US President Donald Trump had set for countries to sign trade deals with the US to avoid steep tariffs on imports was extended from 9th July to August 1st. READ MORE The European Commission, the EU's executive arm, had been rushing to ink a deal with the White House by the original deadline on Wednesday, to avoid EU states being subject to threatened tariffs of 50 per cent. Speaking on Tuesday, Mr Donohoe said the extension likely meant 'we now have a number of more weeks of negotiation to go,' before a EU-US deal was agreed. [ Opens in new window ] Officials in Brussels and Dublin recognise the Trump administration will insist 10 per cent tariffs charged on European products sold into the US since April remain in place. The negotiations are focused on heading off higher trade levies of 20 or 50 per cent being charged on trade coming from the EU. EU and US negotiators are also exploring a proposal that European car manufacturers could offset some portion of import levies they would be charged, based on the size of their manufacturing footprint in the US, although the details of how such a scheme would work are vague, one EU source said. It is accepted that any deal will be an 'agreement in principle,' that leaves many of the complex and contentious details to be worked out at a later point. How the wealthy are buying up land to avoid inheritance tax Listen | 22:03 Economic planning by the Government for next year's budget 'will have to assume the presence of tariffs', Mr Donohoe said. 'It does look likely that tariffs are going to be a part of the new trading relationship that we will have with the US,' he said. 'I hope the negotiations that are under way in some way lessen their effect and their level with regard to particular sectors,' the Fine Gael minister said. The Government had made its case to the commission, who is leading the EU negotiations, about 'a number of sectors that are particularly important to the Irish economy,' he said. [ China warns countries on agreeing US tariff deal that would come at Beijing's expense Opens in new window ] 'Our assessment is that the negotiation is still ongoing and that we are not at the point where a deal has been done,' Mr Donohoe said. Some divisions are emerging between those who believe the EU should get a quick deal over the line at nearly any cost, and others who are concerned about locking the bloc into terms overly favourable to the US. 'We have to weigh up whether the benefit we get in uncertainty lifting is outweighed by the costs that could be created by the nature of the agreement itself,' Mr Donohoe said. He was speaking in Brussels after attending a meeting of EU finance ministers. The economic disruption and uncertainty caused by the transatlantic trade dispute would be a factor in the Government's budget planning, he said. There was a need to move away from the giveaway budgets of recent years, characterised by one-off measures to help people with their high cost of living, towards 'a more normal' budget, Mr Donohoe said. 'We do have to bring to conclusion the budgets that we had when inflation was so high,' he said. 'With all the economic uncertainty that we are in and the fact that that is likely to continue for some time, we have to move how we plan our budgets now into a different place,' he said. The expansive budget packages of recent years had come at a time when the rate of inflation was around 10 per cent, 'as opposed to where it is now at 2 per cent,' Mr Donohoe said.
Irish Times
2 hours ago
- Irish Times
The roots of the British malaise lie in a sick economy
The UK suffers from three failures: failing politics; a failing state; and a failing economy. Of these, the last is much the most important. I am not arguing that these failures are significant by global standards: UK politics is still relatively decent and democratic; the state is relatively competent and effective; and, not least, the British still enjoy a relatively high standard of living. The problem is that the economy does not provide a rising standard of living or the expected quality of public services at politically acceptable levels of taxation. The state is also unable to ameliorate the painful trade-offs this reality has imposed. Finally, the politicians cannot confront the choices they face, as we have seen with Keir Starmer, most recently over welfare reform, but also over the questions of tax, spending and economic reform raised in the 2024 general election. READ MORE Numbers tell the story. According to the from the National Institute of Economic and Social Research, real disposable income per head rose by just 14 per cent between the third quarters of 2007 and 2024: it had risen 48 per cent between the third quarters of 1990 and 2007. According to the International Monetary Fund (IMF), the trend growth of gross domestic product (GDP) per head in the UK had been 2.5 per cent a year from 1990 to 2007: then, between 2008 and 2025, it was just 0.7 per cent. Keir Starmer is not a charlatan. But he has not been prepared to take on the burden of leadership that current conditions require. This reduction of 1.8 percentage points in the growth rate was the largest in the group of seven high-income countries (plus Spain). In the second period, only Italy has grown considerably more slowly than the UK. As a result, UK GDP per head in 2025 is forecast to be 33 per cent lower than it would have been if the 1990-2007 trend growth had continued. This is the biggest shortfall among all these countries. All of this is rooted in the most important collapse of all, that in productivity growth. According to the Organisat ion for Economic Co-operation and Development (OECD), real output per hour rose by a miserable 6 per cent in the UK between 2007 and 2023. This was the same as in France and again, above Italy. But in the US the rise was 22 per cent. In the euro zone as a whole it was 10 per cent. The UK's stagnant productivity is a big worry. When economies cease to grow, everything becomes zero-sum: more for one group of people means less for others. How the wealthy are buying up land to avoid inheritance tax Listen | 22:03 The problem is even greater if demographic change increases the number of beneficiaries of fiscal transfers relative to that of productive taxpayers. The overwhelming questions in politics become how to contain the discontent when much of the population has stagnant real incomes, how to manage the public finances, especially during shocks, and how to get the economy growing again. These are tough questions. This is partly because the most important of all, namely, what to do to raise economic growth, is so hard to answer. Nobody expected such a large and widespread fall in trend growth in high-income countries as has happened since 2007. Even the US has suffered a significant decline in growth of GDP per head in the post-2007 period. But the decline in the UK's growth rate is quite exceptional. More fundamentally, while economists have some ideas about the sources of economic growth, these amount to much less than precise knowledge. This is partly because both the nature and impact of technological progress is so hard to foresee. Today, for example, some think artificial intelligence will transform productivity for the better. Others most definitely are sceptical. Indubitably, a serious government would be devoting vast intellectual resources to the question of how to raise the growth rate. None has, including this one. The charlatans pretend that something simple – Brexit or huge unfunded tax cuts – will deliver. A starting point, in my view, must be recognition that the Thatcher experiment failed: it did not transform the underlying performance of the economy for the better. This must now be admitted. Too much of the post-Thatcher performance was unsustainable. This was, in good part, because it was the fruit of a global credit bubble, in which the UK was a leading actor. My hope is to devote future columns to how a new growth strategy might work. But, before that, it is crucial to recognise the political responses we have been seeing since 2010. By and large, these have fallen into two categories: charlatanism and timidity. The charlatans pretend that something simple – Brexit or huge unfunded tax cuts – will deliver. The timid have been relatively responsible. But they have been unwilling to admit the scale of the economic and political challenges they confront and then make hard choices. Keir Starmer is not a charlatan. But he has not been prepared to take on the burden of leadership that current conditions require. I sympathise. But his timidity will not work. – Copyright The Financial Times Limited 2025
Irish Times
3 hours ago
- Irish Times
Siptu spent just €15,000 from €1.3m political donations fund, accounts show
Ireland's largest trade union spent just €15,000 from a €1.3 million political donations fund, according to accounts for 2024. The record of Siptu's spend on political donations for last year was recently lodged with the Register of Friendly Societies, which is the central holder of statutory information for trade unions and certain other bodies. There were European and local elections in June 2024, as well as a general election in November. Siptu's annual returns cover only the two held in June, as the latter came too late for payments to be processed that year. The union's political fund, to which almost 130,000 of its members contribute, increased in value by almost €100,000 over the course of the year despite the various elections. READ MORE Siptu tends to only back candidates with strong links to the union, usually via actual membership. Just one candidate running in the Europeans – People Before Profit's Cian Prendiville from Limerick – was financially backed, with a donation worth €950. For the local elections, donations of €595 went to 22 candidates, 15 of whom ran for the Labour Party. The remaining seven included contenders running for Sinn Féin, the Workers' Party, the Social Democrats and the Green Party. It is understood that just a handful of general election candidates, including Labour's Marie Sherlock and Duncan Smith, would have received support, and this again would have involved modest amounts. The union says the fund is also available to be used for campaigns it runs. However, there were no other outgoings in 2024. The documents show that the union's membership declined by about 5,000 in each of the past two years and stood at 193,508 at the end of last year. The membership tally is understood to include a range of member categories, including those who have retired but maintain their membership without paying full subscription rates. Siptu says a rise in subscriptions is a better indication of active members. This increased last year, from €32.2 million to €32.5 million. However, the higher amount is almost the same as the figure for 2014 when the all-categories membership figure was 210,670. In 2019 subscription fees totalled €33.8 million, and there were 211,855 members. Covid presented big challenges. The union's industrial contingency, or strike fund, contained €19.2 million by the end of 2024, while there is almost €10 million set aside for the modernisation of Siptu's headquarters at Liberty Hall in Dublin. Overall, the accounts record net assets of about €53 million across a range of funds and an operating surplus of €1.17 million for the year. [ Siptu renews push for recognition at several large plants in pharma and medical device sectors Opens in new window ] Staff costs accounted for €23.9 million, of which a third (just short of €8 million) was contributions to the union's defined benefit scheme. In a 2022 review, this scheme was found to have a €20 million deficit and therefore was in need of additional payments. Over the course of 2024, Siptu employed an average of 250 staff, down from 267 in 2023. The organisation's four most senior personnel together cost €610,000, the accounts indicate.
