Donald Trump’s threat to impose a 25 per cent tariff on goods coming into the US from Canada and Mexico would damage Smurfit WestRock’s paper and packaging business although the full cost of that impact is not clear, the Dublin-based company’s president and chief executive has said.
Speaking to Inside Business, an Irish Times podcast, Tony Smurfit said: “I can only think it’s going to be very bad for business in general. We can see some direct effects with our Canadian mill and with stuff we bring into Mexico from America and vice versa. But that would be minor to the effect on American consumer confidence to electricity being shut off in New York and places like that which Canada has threatened to do.
“Our Canadian mill will be at risk because it’s a large mill that sells most of its product into the United States. It’s a commodity product and if you have a tariff on paper going into the US that’s making it 25 per cent more expensive on a commodity it’s just not going to work.
“There are paper products going from the US into Canada so there will probably be a countervailing tariff that would maybe mitigate that. We’ll obviously work on that and see how it plays out.”
Mr Smurfit, who has led the company since 2015, said there are more than 300 staff at the mill in Canada who would be impacted by a tariff move by Mr Trump. He said the effect of tariffs, both directly and indirectly was the subject of a board call on Monday.
“There will be businesses put at risk but how long do you live with those businesses while they make losses. It depends on how long the tariffs go on for. There’s no way to put an accurate figure on it.
“There are potential hits everywhere...look at champagne [packaging] out of France, food [packaging] out of Italy, there’s potential hits everywhere. But, at the end of the day, we supply products that people want and need so the thing is what’s the demand destruction based on the tariffs and that’s something nobody can predict.
“I did not think when Trump got elected that he would go ahead with the tariffs because I thought that would just be economic suicide for America. I believe reason will [prevail] at the end of this.”
‘My plan is to make sure Smurfit Westrock is one of the great companies of the world’: Tony Smurfit on taking the family business global
Mr Smurfit oversaw the combination last year of Smurfit Kappa with its American peer WestRock in a $24 billion deal that has made the enlarged entity the biggest paper and packaging group in the world. It has about 100,000 employees and operates in 40 countries.
His ambition now is to “make Smurfit WestRock one of the great companies of the world, not just one of the great companies of our sector. How do you accomplish that? You accomplish that by having great people. So the biggest challenge is to make sure I keep, retain and motivate our people across the world.”
Mr Smurfit, who is 62, says this was a long term aim of his and he plans to lead for the company for a number of years to come.
“That’s not going to happen [making it the best company in the world] in the next three to five years. That will happen during a period from three years onwards and then I will reflect with the board as to what my view is [on his role],” he said.
“But my current view is to stay as long as possible because I love what I do. I say to people who do retire at 62, ‘I think you’re crazy’. Work should be enjoyable...for me I love most days of my job. Most of my days are good.”
