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“Not the act of a friend” was how Prime Minister Anthony Albanese described the decision of US President Donald Trump to impose a minimum baseline 10 per cent tariff.
Trump’s “Liberation Day” tariffs have resulted in what many Australians feared – a 10 per cent minimum baseline tariff.
During his announcement this morning, Trump singled out Australia and its beef industry, saying: “[They] banned American beef. We imported $3 billion of Australian beef from them just last year alone. They won’t take any of our beef.”
“They don’t want it because they don’t want it to affect their farmers. And you know what? I don’t blame them, but we’re doing the same thing right now, starting at midnight tonight.”
The imposed tariffs orchestrated by Trump – which have also targeted the EU, Taiwan, China, Japan, Canada, India, South Korea, and Cambodia – are set to come into effect on 5 April 2025 at 12:01am (Australia time).
In terms of retaliatory tariffs, Trump stood firm on the fact that he would modify or adapt to any retaliation from the targeted countries.
“Should any trading partner retaliate against the United States in response to this action through import duties on US exports or other measures, I may further modify the HTSUS to increase or expand in scope the duties imposed under this order to ensure the efficacy of this action,” Trump said.
At the same time, Trump claimed that America was only charging “half of what they are and have been charging us”.
In response to the announcement, Prime Minister Anthony Albanese labelled the tariffs as completely “unwarranted”.
“The Australian people have every right to view this action by the Trump administration as undermining our free and fair-trading relationship,” Albanese said this morning (3 April) via the ABC.
“Our existing Free Trade Agreement with the United States contains dispute resolution mechanisms. We want to resolve this issue without resorting to using these.”
Despite raising that there would be “consequences” for the US, pertaining to Trump’s announcement, Albanese insisted on avoiding a “race to the bottom” by retaliating with Australia’s own tariffs.
‘No one is immune’
Speaking on the consequences for Australian businesses moving forward, Innes Willox, chief executive of the Australian Industry Group, argued the announcement was “disappointing, but not unexpected”.
“Today’s announcement that Australia will be subject to a minimum baseline 10 per cent tariff is disappointing, but not unexpected, as we deal with an American administration hellbent on remaking the international economic order,” Willox said.
“It also sends an ominous signal about what comes next. This will undoubtedly spark retaliation, imposing barriers on well-known trading relationships and driving up costs for businesses and consumers. As more details emerge, particularly how these different tariffs interact with each other, companies will need to make individual assessments on the impact to their businesses, and we still start to feel the consequences in the economy.
“It is particularly bad news for our nation because we rely on trade for our economic prosperity more than any other economy on earth, with one in four jobs dependent on trade.”
According to Willox, advanced manufacturers throughout Australia will struggle with widespread disruptions.
“Global supply chains in these high-value, high-productivity industries cannot be quickly rejigged in the same way that commodities can. Our advanced manufacturers will face profound disruption as global supply chains adjust around the new US tariff wall,” he said.
Business Council of Australia chief executive Bran Black urged the need for a measured response, noting how the changes may have grave impacts on Australian jobs.
“The United States is a longstanding friend and ally, and we’ve historically stood together through thick and thin, and so every Australian should be disappointed by these tariffs.
“We don’t support retaliatory tariffs and strongly urge against them because there are no winners in a trade war, which would only risk making our situation worse by forcing Australians to pay more and reducing job security.
“As a trading nation, free and open access to global markets is critical for Australia, especially as one in every four of our nation’s jobs relies on trade,” Black said.
“We need policies that ensure businesses have the best chance to be successful, so we can continue to drive economic growth and new and better jobs for Australians.”
From a regional aspect, Business NSW chief executive Daniel Hunter touched on the “ripple effect” that will be felt throughout NSW for both large and small businesses.
“While some NSW businesses engage directly with the US market, the ripple effects will extend throughout the entire business community. The uncertainty alone is enough to cause widespread concern,” Hunter said.
“The indirect effects of tariffs imposed on Australia’s key trading partners, such as China, are likely to reverberate back to NSW businesses, amplifying the challenges faced.
“Regional NSW will also be hit hard. Regional exporters are already operating on tight margins. Any increase in tariffs will mean that producers will need to rework their business models.”
For businesses that aren’t directly exporting with the US, the strain will still be felt, according to Hunter.
“Even businesses not directly exporting to the US will feel the strain through disrupted supply chains and increased operational costs,” he said.
Kace O'Neill
Kace O'Neill is a Graduate Journalist for HR Leader. Kace studied Media Communications and Maori studies at the University of Otago, he has a passion for sports and storytelling.
