No tariff retaliation if Donald Trump targets us, says Jim Chalmers

Jim Chalmers has signalled the ­Albanese government would not retaliate against the US if Donald Trump were to slap tariffs on Australia’s exports.

Treasurer Jim Chalmers in question time on Tuesday. Picture: NewsWire / Martin Ollman

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Jim Chalmers has signalled the ­Albanese government would not retaliate against the US if Donald Trump were to slap tariffs on Australia’s exports.

Canada and Mexico had vowed targeted retaliation to the President’s threatened 25 per cent tariffs but won temporary reprieves on Tuesday after they pledged to bolster security on their borders with the US.

The Treasurer said the government was not preparing a similar response, arguing it was confident the nation would be spared from Mr Trump’s looming trade war.

“That’s not something that we’re considering or contemplating,” he said.

“We did a heap of work before the election to look at the possible consequences of trade tensions, and that has helped inform our approach. That’s one of the reasons why we are well placed and well prepared, because we’ve done the work, we’ve put the thinking into it. We’ve got a good case to make.”

The government hopes Australia’s trade deficit with the US and the nations’ close strategic partnership will help it avoid Mr Trump’s tariff onslaught.

“We’re not being presumptuous about the discussions we have with American counterparts, but we do have a very strong case to make,” Mr Chalmers said.

“Our economic relationship is very different to the American economic relationship with Canada or Mexico or China or the countries that have been President Trump’s focus.”

His comments come as Deputy Prime Minister and Defence Minister Richard Marles prepares to head to the Washington on Thursday for face-to-face talks with Mr Trump’s new Defence Secretary, Pete Hegseth.

The AUKUS pact is expected to top the agenda, along with the US military’s growing presence in Australia through so-called “force posture measures”, including rotational deployments of US bombers, marines and, in the future, US nuclear-powered submarines.

Mr Marles is also expected to meet with key congressional Republicans before heading home to attend parliament on Monday.

The trip follows Penny Wong’s visit to Washington for Mr Trump’s inauguration, when she met new Secretary of State Marco Rubio and attended a Quad foreign ministers’ meeting.

Mr Trump pulled North America back from the brink of his threatened trade war with just hours to spare after he agreed to suspend the imposition of tariffs for 30 days following talks with Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum.

However, there was no reprieve for China, which had a 10 per cent tariff slapped on its goods from midnight Monday local time.

Business Council of Australia chief executive Bran Black said the government needed to prepare for “any potential scenario” but Australia’s dependability as an ally and its trade deficit with the US would stand the nation in good stead.

He said businesses were more concerned with the secondary effects of Mr Trump’s tariff hike on China than a direct impost on Australian exports.

“That has the potential to reduce demand for Australian commodities that go into Chinese products that they then sell into the American market,” he said.

“The challenge for us there is that there is a risk with respect to jobs. Australia is a trading nation. One in four jobs are trade dependent.”

Opposition trade spokesman Kevin Hogan said the tariff issue loomed as a major test for Anthony Albanese and Australia’s ambassador to the US, Kevin Rudd.

“When we were in government, during President Trump’s first administration there were the threats of tariffs on aluminium and steel. We had ambassador (Joe) Hockey, which helped Australia to successfully negotiate exemptions from United States steel and aluminium tariffs.

“Prime Minister Albanese and ambassador Rudd have a big job on this issue. I hope they are up to it.”