Irish SMEs have 'limited exposure' to trade war, says survey

UK remains of systemic importance to Irish SMEs, says ISME chief Neil McDonnell

ISME chief executive Neil McDonnell said the flash survey shows the systematic importance of the UK to Irish SMEs.

Small and medium businesses would face only “limited exposure” to potential tariffs on US imports, a survey by representative body ISME found.

US president Donald Trump announced on Sunday he plans to impose 25% tariffs on steel coming into the United States with additional duties for aluminium. The EU has signalled that it will reply with tariffs on US goods.

A flash survey by ISME of 120 members to assess exposure to tariffs found that while 74% of SMEs rely on imports, the majority of these (57%) source their goods from the UK, while only 19% of imports originate from the US.

This suggests that SMEs would face limited exposure to potential EU-imposed though the specific composition of these imports is yet to be analysed, ISME said.

ISME chief executive Neil McDonnell also said the survey highlights that despite Brexit, the UK remains of systemic importance to Irish SMEs. “While ISME is hopeful that the impacts of a tariff war with the US can be avoided, a priority for the Government must be to ensure that the impact on essential imports for SMEs are minimised, and that the relationship with the UK post-Brexit is sustained and further strengthened,” Mr McDonnell said.

Most Irish SMEs are small importers, with 43% importing goods valued at less than €250,000 annually. Just 29% of those surveyed SMEs engage in exports, with UK being the primary destination, and accounting for 66% of the total exports. The US followed as the second-largest export market, accounting for 37% of the exports. Most SMEs are small-scale exporters, with over half of exports less than €250,000 per annum.

Of those that responded to the survey, which was carried out in the first week of February, 71% export while 74.4% import.

The main export markets amongst those surveyed are: UK, US, Belgium, France and Germany. The main import markets are UK, Netherlands, US, Germany, China, France, and Belgium.