Australia slams 'unjustified' US levies
Australia's steel and aluminum industry is bracing for the impact of the latest tariffs from the United States, after President Donald Trump announced a doubling of levies just months after rolling out worldwide protectionist measures.
Trump said on Friday that he plans to increase the tariff on steel and aluminum imports to the US from 25 percent to 50 percent starting on Wednesday — to protect the US industry from foreign competition.
Australia's Minister for Trade and Tourism Don Farrell said in a statement on Saturday that the doubling of tariffs on steel and aluminum was "unjustified" and an act of economic "self-harm".
Australia's position has been "consistent and clear" and the government will continue to advocate strongly for the removal of the tariffs, Farrell said.
In a media release on Saturday, Farrell said he will be leading an Australian delegation to France for the OECD Ministerial Council Meeting in order to "advance Australia's trade interests and advocate for the rules-based trading system".
"On the sidelines of this meeting, Australia will host the annual informal gathering of World Trade Organization ministers. The meeting will provide an opportunity to build momentum for WTO reform and reinforce the importance of an open, rules-based global trading system," he said.
Australian goods exports to the US are already subject to a 10 percent baseline tariff, with the government of Prime Minister Anthony Albanese having ruled out retaliatory tariffs as it tries to secure an exemption for the country's products.
The Australian opposition considered Trump's announcement concerning for Australian jobs and urged the US not to undermine the principles of free trade.
"We expect the United States to honor its obligations under the Australia-United States Free Trade Agreement, just as Australia has always done. The strength of our economic partnership has been built on trust and mutual benefit, and any deviation from this agreement undermines the principles of free trade," Shadow Trade Minister Kevin Hogan said in a statement.
The sudden doubling of steel and aluminum tariffs was unexpected, Australian Steel Association chief executive David Buchanan told local media.
'Quite a shock'
"It was quite a shock, but we shouldn't be shocked by anything… that happens at the moment out of the US," the Australian Broadcasting Corporation cited Buchanan as saying on Monday.
Responding to the worldwide tariffs imposed by the Trump administration on the so-called 'Liberation Day' in April, the Australian Workers' Union had in a statement highlighted the need to "pivot to a more muscular and independent approach to industry support".
Ben Udy, lead economist for economic advisory Oxford Economics Australia, told China Daily that Australia exports a significant amount of steel and aluminum to the US, "so the increase is unwelcome news for those exporters".
"But our previous modeling suggested the first round of steel tariffs could have a small positive impact on the Australian economy. After all, if the US wants to increase steel production, it will need more iron ore and coal to do so," Udy said.
Given Australia's dominance as an iron ore exporter, the net effect for the Australian exports to the US could be positive, he said.
"While the impact on exports to the US may be offset by higher iron ore exports, this would still cause a disruption for those sectors," Udy said, adding that if iron ore or coal exports rise it would likely benefit the economies of Western Australia and Queensland states. However, reduced steel exports would probably impact New South Wales and South Australia states to a great extent.
"Australia has never been a large exporter of steel. To the extent that Australian steelmakers wish to differentiate themselves in the global market, a shift toward higher value green steel may make sense," he said, adding that the adjustment would probably take considerable time.
alexishooi@chinadaily.com.cn
?
