Prime Minister Anthony Albanese has declared Australia has an “ideological disagreement” with the United States, following the US revealing a plan to impose a 12.5 per cent tariff on exported goods from the junior ally.
The new tariff is planned to be slapped on dozens of countries for allegedly failing to take action to prevent slavery and forced labour.
It is the latest attempt by the Trump administration to hit nations with import taxes since the US Supreme Court struck down 10 per cent tariffs that impacted Australian imports in February.
The tariffs would replace, and slightly increase, the Trump administration’s existing global 10 per cent temporary import surcharge when it expired on July 24.
(AP Photo: Evan Vucci)
Mr Albanese said any tariff on Australian exports to the US was “unjustified and inconsistent” with the free trade agreements between the two allies.
“There is an ideological disagreement where the United States administration has broken with what was a decades-long understanding that tariffs are not positive for the country that is imposing them,” Mr Albanese told the ABC.
“They increase the cost of goods and services in the country that is applying them to its consumers, and … free trade is in the interests of the global economy.”
More than 50 countries will be subject to the new tariff over allegations they have failed to prohibit the importation of goods produced with forced labour.
US ambassador to Australia Jamieson Greer argued the alleged failure to ban products produced with forced labour created a “dynamic where American workers are forced to compete globally on an unlevel playing field”.
Australian Trade Minister Don Farrell met with Mr Greer on the sidelines of the Organisation for Economic Co-operation and Development (OECD) meeting in Paris overnight, where Mr Farrell told him the tariffs were “unjustified”.
The tariffs would replace, and slightly increase, the current US global 10 per cent temporary import surcharge when it expired on July 24.
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Mr Albanese said Australia had world-leading legislation addressing forced labour and modern slavery that passed through parliament with unanimous support.
‘World’s on its head’
Mr Albanese also highlighted the point, which US President Donald Trump has also raised, that Australia has a trade surplus with the United States, which means Australia buys more from the US than it sells.
He said the tariffs were a penalty on US consumers and harmed international trade.
“We actually think not only is it not in the interest of the United States, importantly it undermines the global trading system,”
Mr Albanese said.
“It’s one of which no notice was given. One of the things that we ask for in terms of international engagement is certainty. Australia and the United States are important allies.”
“It is unfortunate that there have been a rolling series of decisions, some of which change from time to time, but all of which do have a common theme, which is that the United States is a supporter of tariffs.”
Joe Hockey says he has argued with Donald Trump about tariffs, but he will not budge on his position. (ABC News: Matt Roberts)
Opposition Leader Angus Taylor said the tariffs were “rotten” and should not be imposed on Australia.
“They are a great friend and they shouldn’t do it,” Mr Taylor said.
“It’s not what we want to see and we’ll fight against rotten tariffs.”
Former federal treasurer and former Australian ambassador to the US Joe Hockey said he was not surprised by the move by Trump administration.
“The president of the United States is absolutely convinced that tariffs are great,” Mr Hockey told the ABC.
“I’ve argued personally with him on the issue, and he’s just not for moving.”
Mr Hockey said Mr Trump could not see the inflationary and negative impact that tariffs had on American consumers.
“And it just goes to show how the world’s on its head when a left-wing Labor prime minister is trying to convince a right-wing Republican president that free trade is actually the right way to go,” Mr Hockey said.
