Australia has gotten off relatively lightly after the Trump administration unveiled its “Liberation Day” global tariffs, despite lobbying from U.S. companies for more stringent taxes on Australia.
Dubbed “Liberation Day,” the April 2 announcement revealed a global baseline 10 percent minimum tariff on about 75 countries on all goods heading into the United States—several countries were singled out for much higher rates.
President Donald Trump specifically mentioned Australia’s local biosecurity restrictions were a hurdle for U.S. companies wishing to break into the local market.
Australia does not accept U.S. imports of beef, pork, cooked poultry or pears due to various disease concerns.
Since 2003, Australia shut the door on U.S. beef imports amid fears of bovine spongiform encephalopathy—better known as mad cow disease.
While Australia does not charge a direct tariff to the U.S, the Trump administration has taken Australia’s biosecurity fees and regulatory hurdles into account.
“Australians ... they’re wonderful people, wonderful everything, but they ban American beef,” Trump told reporters on March 2.
“Yet we imported US$3 billion of Australian beef from them just last year alone.
“They won’t take any of our beef, they don’t want it because they don’t want it to affect their farmers and, you know, I don’t blame them but (we’re) doing the same thing right now starting at midnight tonight, I would say.”
The United States is Australia’s largest red meat marketing accounting for almost 400,000 tonnes.
Labor Government to Help Exporters Find New Markets
Australian Prime Minister Anthony Albanese called an immediate press conference in response to the tariffs, saying they went against the relationship between the two countries.“President Trump referred to reciprocal tariffs—a reciprocal tariff would be zero, not 10 percent,” he claimed.
“The administration’s tariffs have no basis in logic and they go against the basis of our two nations’ partnership.
“This is not the act of a friend.”
Albanese said the tariff would add to global economic uncertainty and push up costs in the United States.
“Our existing Free Trade Agreement with the United States contains dispute resolution mechanisms,” Albanese said.
“We want to resolve this issue without resorting to using these, as we do support continued constructive engagement with our friends in the U.S.”
The prime minister announced a $50 million fund to help agricultural exporters find new markets
“We will establish a new economic resilience program through our National Reconstruction Fund. This will provide $1 billion in zero-interest loans for firms to capitalise on new export opportunities,” Albanese said.
“Just as we are already encouraging more people to buy Australian, our Labor government will buy Australian, too.”
The prime minister also earmarked a “critical minerals strategic reserve” but noted more details would be revealed later.
Meanwhile, Trade Minister Don Farrell expressed hope for a free trade deal with the European Union.
“The world has changed. As of today, the world has changed for Europe.
“Europe has now [been] set back to a much higher tariff into the United States. If they’re sensible, if they’re sensible, they will make us a better offer on the issues that made the agreement fall over last time, and we will get a free trade agreement with the with the EU, the largest economy in the world,” he told reporters.
The opposition continued to press Labor on it’s negotiating skills.
The Lower End of the Tariffs
The 10 percent baseline tariff that Australia is subjected to is on the lower end of the “Liberation Day” tariffs.Multiple Asian nations bore the brunt of the administration’s heavier tariffs including Cambodia, which charges 97 percent tariffs on U.S. goods, Vietnam 90 percent, Sri Lanka 88 percent, Bangladesh 74, Thailand 72, China 67, Indonesia 64, and Taiwan 64.
Trump raised an example regarding motorcycle imports, saying the United States charges a 2.4 percent tariff on other countries.
“Meanwhile, Thailand and others are charging much higher prices, like 60 percent, India charges 70 percent, Vietnam charges 75 percent, and others are even higher than that,” Trump said.
He also reiterated the issue with U.S. motor exports being met with very high tariffs from the European Union, India, South Korea, and Japan.
“The United States imposes a 2.5 percent tariff on passenger vehicle imports (with internal combustion engines), while the European Union (10 percent) and India (70 percent) impose much higher duties on the same product,” said the White House fact sheet.
The 10 baseline percent is below the 25 percent tariff the imposed on Australian steel and aluminium exports.
Australian Meat Industry Council CEO Tim Ryan told AAP Australia could weather the storm due to the high demand for Australian beef.
“The global demand for high-quality Australian red meat continues to grow, and our supply chain is well-positioned to respond to shifts in the international trade landscape,” he said.
