Northern Ireland must weather turbulence of global trade once again

The impact of Trump’s trade policies on Northern Ireland

With Donald Trump’s return to the White House, Northern Ireland finds itself facing renewed uncertainties in the sphere of US trade policy, tariffs, and foreign direct investment (FDI). What is becoming increasingly evident is that tariffs aren’t just a story for the financial pages. They have real consequences for businesses and consumers. When trade routes are disrupted, costs rise, investment stalls, and economic confidence erodes.

Given the uncertainty, delays and changes to date around the imposition of tariffs, the annual trek to the US around Saint Patrick’s Day by many of our business and political leaders is one of the most significant in years. 

President Trump’s trade policies, characterised by threats and rapid reversals, have heightened global uncertainty. His past decisions to impose tariffs on Canada, Mexico, and China triggered stock markets to fall and retaliation, highlighting the real-world impact of such measures on global economies, including the UK and by extension, Northern Ireland. 

Northern Ireland’s exposure to global trade tensions

Northern Ireland’s vulnerability is multi-layered. As a region deeply embedded in global trade, particularly through its agri-food, manufacturing, and services sectors, the ripple effects of US protectionism could be profound. Tariffs could disrupt key sectors, exacerbate global trade tensions, and influence the trajectory of FDI flows.

Moreover, non-tariff barriers - such as regulatory compliance costs and licensing hurdles - pose an additional threat, particularly for Northern Ireland’s growing services sector.  For context, Northern Ireland businesses exported goods to the US with a value of £1.9bn in 2022. The US is our biggest market after GB and Ireland. 

With tariffs now imposed on EU steel and aluminium, and the EU’s counter measures announced, ripple effects could hit Northern Ireland in a number of ways. Tariffs make Northern Ireland’s exports to the US less competitive, squeezing margins or forcing price hikes that dampen demand.

Moreover, should US imports decline, excess goods that the EU can’t find a US customer for could flood European markets, intensifying competition and suppressing prices for local producers. Northern Ireland’s businesses, already navigating Brexit-related complexities, could face a fresh wave of market instability. The concern is not just about direct impacts but also about the indirect consequences of a shifting global trade environment.

Preparing for uncertainty and protecting economic stability

Currency fluctuation adds another layer of unpredictability. Protectionist policies that strengthen the US dollar would make Northern Ireland’s exports more expensive, reducing demand and further unsettling trade dynamics. Businesses that rely on exports may face a double hit - from reduced competitiveness abroad and from increased operational costs at home.

Risks aren’t just in the numbers but are also in sentiment. Economic uncertainty leads to hesitancy. Investment is delayed, hiring decisions are paused, and supply chains are rerouted. It is a scenario all too familiar to Northern Ireland, echoing the cautious inertia experienced during Brexit. Uncertainty can kill economic momentum.

So far, the UK has avoided Trump’s tariff ire. While that may change, a scenario where NI is not facing tariffs will be a very positive outcome. Unfortunately, the economy can’t afford the luxury of waiting and seeing. The lesson from Brexit is that uncertainty alone can cause lasting damage. Trade conditions can change overnight, but those prepared for disruption are more likely to withstand the shock.

Northern Ireland’s economic stability depends on proactive planning and strategic foresight. Diplomatic engagement, export diversification, and rigorous scenario planning must be prioritised. It means businesses looking beyond traditional markets, exploring alternative suppliers, and actively modelling the potential impacts of tariff changes.

The unpredictability of global trade is a given. But uncertainty cannot excuse inaction. Northern Ireland has weathered economic turbulence before, and with careful preparation, it can do so again. The task now is to ensure that the region remains competitive, resilient, and ready to navigate the complex terrain of global trade in the years ahead, whatever comes.