In an important event back in March, the United States President, Donald Trump, held a meeting with Micheal Martin, the taoiseach of Ireland. This meeting occurred prior to the commemoration of Liberation Day on April 2 and the announcement of a worldwide trade conflict by the Trump administration. Further adding to the tensions, the US president had also revealed the plan to impose harsh 30% tariffs on the entirety of the European Union, a directive targeted to be implemented from the first day of August.
Ireland, herein, holds a significant position as a critical exporter of vital and often life-saving pharmaceuticals to the United States. The supremacy of the European Union in the sphere of medicinal imports to the U.S is vast, providing treatments for a number of conditions such as diabetes, hypertension, depressive disorders, and various cancer types. Not just the medicines, the EU is also a principal source of several chemical compounds essential for the production of these medications and other pharmaceuticals in the U.S.
As such, the high-stakes 30% tariffs due to be imposed on the EU from August 1 pose a more serious threat to American citizens than corresponding actions against nations providing imports such as mobile phones, apparel, toys or automobile parts. One of the most deeply felt impacts of such a levy would be on the costs of these crucial medical treatments. Undoubtedly, a hike in their prices, arising from increased tariffs, would most severely affect the poorest and the uninsured strata of the nation’s population.
The European Union, reportedly, has been communicating indications of its resolve not to yield under these escalating tensions. One noteworthy aspect of this economic conflict with the EU is its distinction from President Trump’s usual approach to trade issues, which leans towards bilateral discussions. The EU, however, is a bloc of 27 countries, and thus stands out from Trump’s usual approach to trade issues.
Importantly, despite the initial proclamation of tariffs against global nations – over 100 countries with whom the US experiences a trade surplus – on April 2, President Trump has postponed the greater part of these tariffs twice. As it stands, a 10% foundational tariff, along with several sector-specific tariffs, remain in effect.
As part of his strategy, the US President is taking on several countries such as China, Canada, Mexico, and the European Union. These countries are strategic targets because they represent some of the largest U.S. trade deficits. However, this strategy leads to an effect on the United States’ biggest export markets, ruffling a major part of the country’s economic metrics.
Current data up until May reveals the European Union is responsible for 20.22% of all U.S. imports and 18.57% of all U.S. exports. To ascertain which imports would most negatively impact the U.S., should the 30% tariffs come into effect as scheduled, the imports from the EU drawing the most significant global market share were examined. The analysis was concentrated on the top 50, accounting for approximately 73.29% of all imports up to May, instead of the entire estimated 1200+ import categories.
The results revealed that health care related goods dominated this list, where six out of the ten largest market share import categories were related to this sector. Market shares for these healthcare-related products ranged from 62.36% to an impressive 99.22%. It’s thus clear the critical role these health care goods, many of which are vital for American citizens and sometimes even necessitated for their survival, play in the trade relationship between these regions.
However, the potential impacts of increased tariffs are not limited to import items. The repercussions also extend to U.S. exports that are crucial to Europeans’ health and overall well-being. When examining the top 10 U.S. exports, drawn up in the same way as the import categories were studied, six are related to the health care sector.
Interestingly, there is noteworthy overlap between these six health-related items across exports and imports, with three items appearing on both lists. Both the U.S. and the EU thus rely heavily on each other’s markets for these crucial healthcare products. When scrutinizing the EU’s proportion of these six U.S. exports, the values ranged significantly, spanning from 46.78% to almost complete domination at 98.86%.
The reciprocal relationship in the healthcare sector between the U.S. and the EU thus becomes apparent. Both parties depend heavily on each other for essential healthcare goods and their availability. This interconnected web of imports and exports underscores the potential large-scale impacts and significant consequences that higher trade tariffs could instigate.
The post Trump’s Tariffs Threaten EU-US Pharmaceutical Trade appeared first on Real News Now.
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