Australia warned over tariffs as Trump prepares to shake up world trade this week

Donald Trump is expected to lift a 90-day pause on tariffs levelled against other countries within days, with the Australian government not expecting to secure a carve out from the 10 per cent ‘base rate’ imposed in April.

Lachlan Leeming

@LeemingLachie

2 min read

July 6, 2025 - 6:36PM

NSW

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The Albanese government has been accused of hoisting the “white flag” in efforts to have tariffs levelled by the Trump administration wiped, as Australia’s peak business body and experts warned of the economic damage which could strike as the world braces for trade upheaval later this week.

The Business Council of Australia (BCA) warned free access to overseas markets was “critical” for the country, while Coalition trade spokesman Kevin Hogan accused the government of not doing enough to win an exemption.

“Pity our Prime Minister is already flying a white flag and not expecting any exemptions for Australia,” Mr Hogan said.

“Other countries have got exemptions, including the UK on the higher steel and aluminium tariffs. Prime Minister Albanese can’t get a meeting and hasn’t prioritised the relationship as he should.”

Prime Minister Anthony Albanese ahead of the International Test match between Australia Wallabies and Fiji at McDonald Jones Stadium. Picture: Cameron Spencer/Getty Images

Mr Hogan said foreign affairs Minister Penny Wong “got a photo opportunity, but came back with nothing on tariff exemptions or the AUKUS review” in last week’s visit to Washington for a meeting of foreign ministers of countries in the Quad alliance.

A spokeswoman for Ms Wong defended work done in Washington, which included a one-on-one with US secretary of state Marco Rubio, saying it was “disappointing” the Coalition “don’t back Australia and the US’ joint efforts to ensure the peace, stability and prosperity of our region”.

“Minister Wong had productive engagements with Quad counterparts, Secretary of State Rubio and the Administration about the security and stability of our region,” she said.

“This included securing agreement for a new Critical Minerals Initiative which will help strengthen supply chains and protect Australia’s future. US engagement in our region, including through the Quad, is critical to Australia’s national security.”

Donald Trump is expected this week to unveil his final decision on tariffs, with some countries facing rates of up to 70 per cent, compared to Australia’s ten.

The move will come days before Mr Albanese is due to head to China, where he is likely to meet with the country’s president Xi Jinping for the fourth time.

BCA chief economist Pero Stojanovski warned one in four Australian jobs are trade dependent.

“Open and free access to overseas markets is critical to Australia’s success, growing the economy and increasing employment opportunities,” he said.

“We know the Government is consistently prosecuting the case why Australia should be exempt from these tariffs, particularly because of our ongoing trade surplus and longstanding strategic ties, which includes the AUKUS agreement.”

US President Donald Trump delivers remarks during an Independence Day military family picnic. Picture: Samuel Corum/Getty Images

Professor in international politics and foreign policy at Deakin University, Damien Kingsbury, said Australia remained vulnerable if an international trade war broke out.

“There’s always going to be a threat if the world starts engaging in tit-for-tat tariffs – Australia has a very globalised economy and is very exposed to global markets … we probably suffer disproportionately when things go south.

“Potentially Australia could be impacted quite negatively, but I wouldn’t be panicking just yet. The major threat for Australia is if China’s economy slows, and we lose some of our exports to that market.”