Tariffs cloud US talk of Quad metals ambitions

US Secretary of State Marco Rubio’s desire for a more deal and results-focused Quadrilateral Security Dialogue is welcome. But it is hampered by the confused messages being sent by President Donald Trump’s trade war and widespread threat of punitive tariffs. As the July 9 deadline approaches for the postponed “Liberation Day” tariffs to again take effect, or maybe not, there is less trust and more questions about where things are heading.

Quad partners Australia and Japan both face unexpected trade imposts. Japan has pushed back on proposed restrictions on car exports to the US. Anthony Albanese is finding it difficult to get a face-to-face meeting with Mr Trump while proposed export duties on domestic steel and aluminium of up to 50 per cent will add to already significant woes in our metals and manufacturing sector caused by higher energy prices. Mr Trump says he is hopeful a trade agreement can be reached with India, the remaining Quad partner, before the July 9 deadline.

Mr Rubio’s comments on Wednesday (AEST) that the Quad should open the possibility for greater co-operation on the development of the rare earths and minerals commodities that China has weaponised against the West in its trade dispute with Mr Trump is a positive sign. Mr Rubio said his ambition was to transform the Quad into a “vehicle for action” rather than a forum for discussing “ideas and concepts”.

Unfortunately, a lack of clarity on how the US is likely to conduct its trade affairs in future under Mr Trump is making things difficult. For Australia, this is particularly so given the public stand-off between the Albanese government and Washington over demands that Australia follow NATO members and lift defence spending beyond 3.5 per cent of GDP. Mr Rubio said India, Japan and Australia were “very important strategic partners and allies” and “together we have a lot of shared priorities, a lot of things we care about in the world”. He singled out the need to develop secure supply chains for critical minerals as a top priority to diversify the global supply chain.

Australia is well placed and keen to co-operate, and has sought to raise the issue in the context of threatened tariffs. But Australia’s confusion is reflected in Foreign Minister Penny Wong’s reluctance to say whether the US remains a reliable ally under the Trump administration. Senator Wong said our strategic partnership was “deep, it’s trusting, it is to the benefit of both nations”. She said Mr Rubio had “expressed regret” that Mr Trump’s scheduled meeting with Mr Albanese at the G7 summit in Canada in June had to be cancelled. Senator Wong said Mr Rubio did not raise with her the Trump administration’s demand for Australia to lift its defence spending.

The omission is significant. Defence spending and our shared geostrategic challenges are the issues that matter. And both sides must work to put things firmly back on track. A failure to do so opens the door for the sort of diplomatic mischief-making being shown by China around the region. So far, the Albanese government seems willing to sleepwalk into Beijing’s diplomatic trap. The federal government must work quickly to take the heat out of the issue of defence spending and the US should consider what it is really attempting to achieve with Australia on security and trade.

Reconsidering tariff imposts on aluminium and steel and forming a strategic partnership on the supply of rare earths and metals would be a good way forward, not just for the Quad.