The EU and US are resetting their trading relationship under US President Joe Biden, the Tanaiste said.
They have agreed to mutually suspend their respective tariffs over an aircraft trade dispute to allow talks to happen.
It will provide great relief to exporters and importers that have been negatively impacted by the levies, particularly exporters of quality goods such as Irish cream liqueur, butter and cheese and importers of animal feedstuff, Leo Varadkar said.
Weekly update from me. Today Iâd like to talk to you about importance of trade. pic.twitter.com/ak4dwJcORG— Leo Varadkar (@LeoVaradkar) March 5, 2021
He added: “This de-escalation is something that I have advocated strongly for in the EU Council of Trade Ministers.
“Ireland is committed to free and open trade. It is what allowed us to rebuild after the financial crisis and it will be crucial as we recover from the pandemic.”
The tariffs were imposed as punishment for subsidies provided to rival aircraft manufacturers Airbus and Boeing.
Their suspension came a day after the US agreed a moratorium on tariffs on UK imports as part of the dispute.
Trade Minister Mr Varadkar said: “Ireland has always maintained a very strong and warm relationship with the United States and that includes the trade relationship.
“This decision is an early sign of both the EU and US hitting the reset button on their trade relationship.
“I hope both parties use this time now to meaningfully engage with each other so that we can resolve this dispute once and for all.”
Agriculture Minister Charlie McConalogue said it was a great opportunity for constructive dialogue to find a permanent resolution.
I was delighted to meet @TimmermansEU along with my colleague @pippa_hackett on a range of climate and environmental measures. Farmers continue to play their part in meeting our climate ambitions.https://t.co/BG4WLnU2Ty pic.twitter.com/xXRcN4oKmI— Charlie McConalogue (@McConalogue) March 3, 2021
The value of Irish agri-food exports impacted by US tariffs, in 2019 figures, is approximately 422 million euros, attracting an additional 105 million euros in tariffs in a full year.
This 25% tariff was applied to Irish exports to the US on butter (190.2 million euros) and cheese (43.7 million euros).
IFA president Tim Cullinan said the resumption of normal trade between the EU and the US is an important development for some premium food exports.
He said: “As an export-oriented sector, it’s vital that barriers are removed from some of our most valuable markets.
“We send over 400 million euros worth of butter, cheese and liqueurs to the US market, where they command a strong price based on consumer demand for quality products.
“Irish farmers rely on these markets to underpin the price they receive for their work and investment.”
He said he hoped this signalled a new relationship between the two trading blocs, and looked forward to increasing the opportunities for Irish food exports.