Penny Wong, Don Farrell stay positive as Donald Trump launches trade offensives on other key US allies | Belinda Willis
The new US president is unpredictable. And that means even South Australia needs a game plan, writes Belinda Willis.
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There is no doubt the new United States President is unpredictable and just as little doubt that financial markets are in for a wild ride with Donald Trump at the helm.
When the President followed through with his loudly promised tariffs for countries on the wrong side of his business and friends ledger yesterday, all hell broke loose globally.
Asian sharemarkets tumbled and shivers of financial apprehension hit European countries as Trump warned they were next on his list.
When neighbouring Canada was hit with a 25 per cent tariff on most goods, the country quickly pulled out a retaliatory tariff regime of its own.
Mexico soon followed suit after being told it was being punished for its failure to stop drugs and migrants crossing the border.
The ASX here in Australia took its own dive and retirees are rightfully jittery about their superannuation.
Word is the Australian dollar is likely to suffer as tariffs risk slowing global growth, some good news for businesses that export to the US but tough on travellers and importers.
It is a volatile political situation and one that Australia’s Foreign Affairs Minister Penny Wong and Trade Minister Don Farrell are approaching with resolute public calm.
The two, along with the Prime Minister, are quite rightly keeping their responses positive as they work to keep the country’s trade vessel steady.
Australians are being told they are, ironically, in a safer position than others around the world as the country imports more American goods than it sends Australian goods in the opposite direction.
The reality is that no government leaders in Australia can be sure that our “long friendship” or import position with the United States will hold firm under the Free Trade Agreement but at this stage it looks more likely than not.
While carefully negotiated diplomatic missions are the way forward, Australia is in an active watch and wait pattern.
It is not just tariffs that are up in the air.
Government leaders will be holding serious meetings focusing on the future of AUKUS and the best ways to mitigate risk around the deal to buy nuclear submarines from the United States falling through.
Here in South Australia, businesses have in contrast, shifted the import-export dial to a trade surplus that has seen industries export $2.13bn of goods to the United States in the past year to November while importing $752.8m worth at the same time.
South Australia’s Trade and Investment Minister Joe Szakacs tells of closely monitoring the situation and supporting Farrell’s “calm and considered approach” to the new US administration as he joins world leaders tiptoeing over diplomatic eggshells.
At this stage, there are no signs that SA export markets will go belly up.
The state’s largest trade exports are beef meat with the latest data showing SA sent $302.5m worth to the United States in the year to November 2024, closely followed by $301m in sheep meat.
One industry stalwart thinks it is drought that will continue to keep that section of the market safe.
He explains that drought has impacted the United States in the past few years, severely reducing herd sizes and meaning that the Americans badly need our protein.
SA also exports refined lead and a healthy dose of wine from the state’s producers who sent over $129.7m worth in the past year.
If tariffs are actually slapped onto these industries it won’t be the first rodeo for our wine makers.
Not so long ago, China took umbrage to commentary from the Morrison Government around the origins of Covid and that led to the bottom dropping out of a wine market worth nearly $1bn to the state after a tariff-led retaliation.
Barley and rock lobster producers also saw their livelihoods whacked by high tariffs and an export ban respectively.
It was a long three years or so of pain that followed.
The wine industry showed it could battle to find new export markets while simultaneously struggling with a red wine glut that saw vineyards razed and businesses go to the wall.
What the market learnt is that South Australians are a resilient bunch.
Our leaders stepped up, wine makers found new markets and when tariffs were lifted eight months ago, wine exports grew from almost zero to just under $650m.
One of Trump’s characteristics is his unpredictability, he will be shaking up worried markets one day and could just as quickly be creating opportunity for country’s like Australia the next.
As tariffs land it may well give our businesses and politicians a chance to find new opportunities in the gaps.
If there is one lesson to learn from the most recent skirmish with China, it is best to keep trade calm and carry on amid this tumultuous new world order.
Belinda Willis is The Advertiser’s State Political Editor.
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