Trump Considers Tariff Exemption for Australia After Call with Prime Minister Albanese
In a move that could potentially ease trade tensions, US President Donald Trump has indicated he will consider an exemption for Australian steel and aluminum imports from newly reimposed tariffs, following a phone call with Australian Prime Minister Anthony Albanese, The Associated Press reports.
The discussion, which was scheduled prior to Trump’s announcement on Monday to reinstate tariffs on steel and aluminum, saw Albanese advocate for an exemption based on the long-standing trade deficit Australia has with the United States.
“We actually have a surplus [with Australia],” Trump told reporters in the Oval Office. “It’s one of the only countries which we do. And I told [Albanese] that that’s something that we’ll give great consideration to.”
Trump’s comments come after he removed previous exceptions and exemptions from his 2018 steel tariffs, effectively applying a minimum 25% tax on all steel imports. He also increased his 2018 aluminum tariffs from 10% to 25%.
Prior to Trump’s remarks, Prime Minister Albanese confirmed he had made Australia’s case for an exemption:
“The US president agreed that an exemption was under consideration in the interests of both of our countries.”
This echoes a previous exemption Australia held during Trump’s first term in office.
Australia’s arguments for the exemption are multifaceted. They include the country’s consistent trade deficit with the US since the mid-20th century, the significant number of American jobs supported by Australian steelmaker BlueScope, and Australia’s relatively small share of the US steel and aluminum markets.
During the call, Albanese also highlighted the AUKUS security pact with the US and Britain, an agreement brokered under the Biden administration, which will see Australia acquire a fleet of submarines powered by US nuclear technology.
This argument is bolstered by Australia’s recent commitment to the AUKUS agreement. Over the weekend, Australia made the first of six $500 million payments to the U earmarked for boosting US submarine building capacity.
Trump’s move comes as he plans to reset US taxes on all imports to match levels charged by other countries, adding complexity to the existing trade landscape. This includes the 10% tariffs he has already imposed on China, China’s retaliatory tariffs that took effect on Monday, and the suspended US tariffs planned for Canada and Mexico until March 1.
Despite the potentially disruptive trade policies, Albanese described the phone call as productive. Following the conversation, he remarked that the “relationship is in good shape.” This marks Albanese’s second conversation with Trump since the president’s election, suggesting a developing rapport despite the potential challenges of the new trade landscape.
