Two days after the United States imposed a 25 percent tariff on Australian steel and aluminium, the Albanese Labor government has announced a $750 million investment to accelerate the development of metals manufacturing.
The new funding is part of the $1.7 billion Future Made in Australia Innovation Fund, outlined in the 2024/25 Budget.
It will focus on driving innovation in the metals sector, particularly in developing low-emission technologies and modernising equipment.
“Australia is already prized for its alumina, aluminium, iron, and steel, and this funding will value add to our high-quality Australian metals exports worth over $150 billion annually” said the government release.
Prime Minister Anthony Albanese said this initiative is designed to unlock commercial-scale production of “green metals” using local ore and renewable resources, and foster new trade opportunities.
This $750 million investment adds to the $5 billion already committed to supporting Australia’s metals industry.
The funds will be managed by the Australian Renewable Energy Agency (ARENA), to ensure transparency.
Albanese Says US Tariff Decision ‘Ideological’
Albanese also addressed the U.S. tariff decision, which he described as more ideological than practical.He pointed out that previous tariff disputes had seen exemptions granted, not just to Australia but to many other countries.
He emphasised Australia’s long-standing trade deficit with the United States over the past 70 years, stressing that a good economic relationship benefits both nations.
Opposition Criticises Government’s Handling of Trade Relations
Opposition Leader Peter Dutton continued his pressure on the government for not securing an exemption to the U.S. tariffs.Dutton described the U.S. tariff decision as a “bad day for Australia,” predicting it would have negative consequences for Australian jobs and industries.
He criticised Albanese’s inability to effectively handle relations with trading partners, saying, “Clearly, the Prime Minister hasn’t been able to do this.”
The U.S. tariff will affect approximately $1 billion worth of Australian steel and aluminium exports, including $378 million in iron and steel and $503 million in aluminium. However, this represents just 1 percent of U.S. steel imports and 2 percent of aluminium imports.
Despite the tariff setback, Australia’s largest steel manufacturer, BlueScope, has previously adapted to similar measures by investing in U.S. production facilities to avoid previous tariffs.
Australia remains the world’s sixth-largest aluminium producer.
