European stock markets went into a tailspin following comments by President Donald Trump that raised fears of a new bout of US-China world trade ructions -- and an explicit threat to the future of many of the 40,000 jobs at the US pharma giants in Ireland.
The main European stock indices closed almost 2.5% lower on Monday after the late Sunday interview when President Trump told Fox News raised concerns over the US relying on supply chains in China and again suggested too many US manufacturers such as big pharma have operations outside of the US, including in Ireland.
"It’s not only China, you take a look at Ireland. They make our drugs. Everybody makes our drugs except us," he said.
"We’re bringing that whole supply chain back."
Administration officials later said the White House intended to rip out supply chains from China.
Stock markets took a battering on fears that the comments in an election year meant that President Trump was intent on re-spaking the global trade conflict to distract from the grim hit to the US economy from the Covid-19 pandemic.
"In a week that is expected to bring an incredible -21 million payrolls number, Donald Trump is trying to shift the blame onto China," said Joshua Mahony at online broker IG.
It is not the first time that President Trump has signalled out Ireland.
He did it first on the campaign trail in 2016 when both he and contender Hillary Clinton took a swipe at US pharma firms in Ireland using so-called tax inversions to avoid paying US taxes.
Then, as president in 2017, when he criticised US firms for their overseas manufacturing plants and urged firms "to bring it back", saying they shouldn’’t be making products "in Ireland and all of those other places".
Ireland has long been vulnerable because it plays host to an outsized proportion of all US pharma plants in the EU which sell products back into the US.
UCC economist Seamus Coffey who wrote the eponymous report on US multinationals for the Department of Finance three years ago said that the comments will cause some lingering concerns for Ireland should President Trump secure re-election in November.
A large share of the 40,000 jobs in US pharma makers in Ireland are employed in the Cork region.
However, Mr Coffey said that despite the latest comments that President Trump hadn’’t move against pharma firms in the EU in the last four years.
A spokesman from IDA Ireland said: “Ireland has built up a very robust life sciences and biopharmaceutical industry over many years, the quality and depth of which is recognised across the world.”
“Companies based in Ireland are at the cutting edge of developing and manufacturing complex oftentimes life-saving drugs for patients which are exported throughout the world. Ireland is a key part of sophisticated global supply chains within the biopharmaceutical industry,” the spokesman said.