Ireland’s treasury received mixed news on Monday, as the country faces growing diplomatic challenges amid the rise of Donald Trump’s influence.
The Central Statistics Office (CSO) revealed that Ireland exported €72.6 billion ($76 billion) worth of goods to the U.S. in 2024, marking a 34% increase from the previous year. While imports decreased slightly, Ireland’s goods trade surplus with the U.S. grew to €50.1 billion. The U.S. has become one of Ireland’s top export markets, closing the gap with the EU.
This surge in exports was celebrated by Ireland’s government, which has long benefited from its strong relationship with the U.S. The country recently accepted a €13 billion ($13.6 billion) backdated tax payment from Apple after a European Union ruling.
“This performance highlights the strength of Ireland’s exporting companies and their efforts to expand into new markets,” said Peter Burke, Ireland’s Minister for Enterprise, Tourism, and Employment.
However, the data also highlights the growing complexities in Ireland’s relationship with the U.S.
Goodbody, Ireland’s oldest stockbroker, drew comparisons between the risks posed by Trump’s leadership and those faced by the U.K. after the Brexit vote in 2016. This is due to Ireland’s close economic ties with the U.S., with its pharmaceutical and tech sectors heavily influenced by American multinationals.
Companies like Eli Lilly, Pfizer, and Johnson & Johnson have set up operations in Ireland, with many of their products shipped back to the U.S. The country’s low 12.5% corporate tax rate has been a significant factor in attracting these firms.
Eli Lilly’s launch of its weight loss drug Zepbound, produced at its Cork facility, contributed significantly to the €18.6 billion ($19.4 billion) increase in Irish exports to the U.S. last year. The company has committed to further investment in Ireland, including a $1.8 billion expansion to produce Alzheimer’s, diabetes, and obesity medications.
But the growing presence of U.S. companies in Ireland has raised concerns among some U.S. lawmakers. In 2023, Brad Setser from the US Council on Foreign Relations questioned the large scale of U.S. imports of pharmaceuticals from countries like Ireland, suggesting that it was tied to tax avoidance.
These concerns could fuel President Trump’s threat of implementing tariffs on European goods. In February, KPMG warned that proposed U.S. tariffs could affect one-third of Ireland’s exports, although the firm suggested the impact would likely be more severe for the U.S.
Edgar Morgenroth, an economics professor at Dublin City University, argued that Ireland is more vulnerable to a trade war with the U.S. than other EU countries. He believes that U.S. tariffs could harm U.S. consumers and lead to negative consequences for the U.S. economy.
Trump’s decision to withdraw from a global deal to set a minimum corporate tax rate of 15% also leaves the U.S. with more flexibility to compete with Ireland’s low tax rates.
Despite these challenges, Daragh McGreal, head of strategic economics at KPMG Ireland, doesn’t expect U.S. multinationals to quickly relocate back to the U.S. due to changes in tax policy.
“Ireland remains an attractive option for investors,” McGreal said. “Multinationals here are unlikely to move back to the U.S. Many see tax changes as part of a regular cycle, rather than a long-term shift in policy.”
While Ireland’s export growth underscores the country’s success in attracting foreign investment, the government will have to navigate potential economic difficulties resulting from the Trump administration’s policies.
