Australia defiant amid Trump threat to double tariffs

Canberra says it’s seeking clarity after US President Donald Trump floated the idea of doubling baseline tariffs on all nations up to 20 per cent.

Australia is trying to make “sense” of President Donald Trump’s latest plan to hike tariffs on all imports to the US, while reiterating the need for free trade.

Health Minister Mark Butler said the Albanese Government would continue to make the case for the removal of all tariffs on Australia, but was seeking clarity on Mr Trump’s intent after the US President floated the idea of lifting the current 10 per cent baseline tariff on all nations to between 15 and 20 per cent.

Mr Butler said US signals on trade had been volatile in recent weeks, including in relation to Mr Trump’s suggestion tariffs of up to 200 per cent would be slapped on all pharmaceutical imports to the US within the next two years.

“The nature of some of these trade positions from the US administration – I’ve found that the position in relation to pharmaceuticals has changed a lot over the last couple of weeks – the nature, the timing, the scale of tariffs that might be imposed not just on Australia but on pharmaceutical imports to the US from anywhere in the world,” he told ABC radio.

Prime Minister Anthony Albanese, Minister for Health and Aged Care Mark Butler meet with Cara Walker (23) who is benefiting from the Government’s Cheaper Medicines policy. Picture: NewsWire / Martin Ollman

“So we’re trying to make sure that we have a sense of what the US administration is planning but continuing nonetheless to prosecute Australia’s national interest and reinforce the importance of free trade between our two countries which we’ve enjoyed since the free trade agreement for more than 20 years.”

Speaking at a press conference in Scotland ahead of a state visit to the UK, Mr Trump revealed he was planning a new tariff for “the world” and when asked how high it would be he said: “I would say it’ll be somewhere in the 15 to 20 per cent range”.

“I just want to be nice,” he said. “Probably one of those two numbers.”

President Donald Trump has threatened to double the minimum rate on all trading partners. Picture: AP

Most nations, including Australia, currently face a baseline rate of 10 per cent, though Mr Trump announced higher “reciprocal” tariffs for many countries in April.

But since then there has been a series of rolling pauses on those taking effect as the US negotiates with its trading partners.

Following Mr Trump’s comments that base rate could double, a spokesman for Australia’s Trade Minister Don Farrell said the government’s position was “unchanged”.

“Any tariffs on Australian goods are unjustified and an act of economic self-harm,” he said.

“We will continue to engage at all levels to advocate for the removal of all tariffs, in line with our free trade agreement with the United States.”

President Donald Trump, right, and Britain's Prime Minister Keir Starmer in Turnberry, Scotland. Picture: AP

Coalition trade spokesman Kevin Hogan said tariffs were “bad policy” and threaten lower global growth that will harm Australia’s exports.

“Australia sold $650 billion of goods and services overseas last year,” he said.

“This reinforces the importance of PM Albanese securing a face-to-face meeting with the US President.”

Mr Trump’s tariff announcement did not rule any particular countries in or out, though he described the new rate as applying to “essentially, the rest of the world” possibly meaning nations that were yet to finalise a trade deal with the US.

“That’s what they’re going to pay if they want to do business in the United States, because you can’t sit down and make 200 deals,” he said.

Originally published as Australia defiant amid Trump threat to double tariffs