The Taoiseach says Ireland will vote against the controversial Mercosur trade deal if it proves to be bad news for Irish jobs and farmers.
He was speaking as he arrived this evening for a special meeting of the European Council in Brussels.
Irish farmers have warned that the draft EU deal with South America will damage the Irish beef industry if it goes ahead.
Leo Varadkar says there will need to be an economic assessment before a decision is made.
"This would go to the trade council for a qualified majority vote in about two years time so there is a long way to go yet," said Mr Varadkar.
"What we will do now is an economic assessment of the Mercosur deal to see what impact it will have on the Irish economy and on jobs.
"If it has a positive impact then we will vote for it."
The Taoiseach also said he is ready to talk about Brexit with Britain's next Prime Minister but he has warned there is no going back on the backstop.
Mr Varadkar says the UK needs to understand that Ireland means what it says.
Theresa May is also attending tonight's EU summit on the future of Europe as one of her final engagements as British Prime Minister.
She says the EU will continue to be vitally important to Britain, even after Brexit.
"Once we leave the EU our relationship with the 27 member states will continue to be important, they are our closest neighbours," said Ms May.
"We will continue to be facing the same challenges and wanting to work together protecting our values."