Speaker 1: From Schwartz Media. I'm Daniel James. This is seven AM.
Speaker 1: Australia is a small player in global trade compared with
Speaker 1: giants like the US and China, so when the world's
Speaker 1: two biggest economies embark on a trade war, we feel
Speaker 1: the impact. Donald Trump's knew tariffs on China could send
Speaker 1: shock waves through the Australian economy, affecting everything from iron
Speaker 1: ore exports to the cost of everyday goods. Australia is
Speaker 1: making the case that tariffs don't make economic sense, but
Speaker 1: with Trump, the usual rules don't apply. Today Chief political
Speaker 1: correspondent for the Saturday Paper Karen Barbo on how Australia
Speaker 1: is navigating a trade war it can't control and what
Speaker 1: happens if Trump doesn't listen. It's Monday, February ten. Karen.
Speaker 1: When news broke that Trump had started hitting Canada, Mexico
Speaker 1: and China with tariffs, he paid Australia's trade minister visit.
Speaker 1: What did he tell you about how big a deal
Speaker 1: this is for Australia.
Speaker 2: Yeah, I had time with the Trade minister this week.
Speaker 3: I mean, with all that's going on and talking to
Speaker 3: like a full board trade war, do you think free
Speaker 3: trade is under threat at the moment. Well, no Don
Speaker 3: Farrell or the Donners is known. He's Australia's top trade negotiator,
Speaker 3: is a top labor.
Speaker 2: Pal broker from the right faction.
Speaker 3: He wants to evoke this sense of calm in the
Speaker 3: mailstroom while we're getting hit every single day with what's
Speaker 3: coming out of the Trump administration. He wants to get
Speaker 3: the message out that Australia has this in hand and
Speaker 3: despite the other Donald's big stick approach you with the
Speaker 3: rest of the world, this is something that he can
Speaker 3: address in what he says, cool calm and collected way.
Speaker 4: Now, cool calm and collective way of prosecuting the arguments
Speaker 4: has been successful. I will it be with Trump?
Speaker 1: Well, I will tell.
Speaker 3: But we are talking about two of the top world economies,
Speaker 3: US and China slapping these sanctions on each other. And
Speaker 3: then we've got this middle power Australia and what it
Speaker 3: means for us. But this is going to be a
Speaker 3: top mission for him. As soon as his US counterpart,
Speaker 3: Howard Lutnik is confirmed as the Secretary of Commerce, he
Speaker 3: will be right in front of him and he wants
Speaker 3: to get Australia's message out there like.
Speaker 1: It's a tail of two dons. And so how is
Speaker 1: the government preparing for any impact on Australia.
Speaker 3: Well, the government wants to let Australians know in the
Speaker 3: first that it's done its homework. Trump and Lucknik have
Speaker 3: been flagging what they are doing right now for months.
Speaker 1: I think we should put tariffs on.
Speaker 4: Stuff we make and not put tariffs on stuff we
Speaker 4: don't make.
Speaker 1: It's pretty simple, and of course it's a barkling ship.
Speaker 3: The Treasurer Jim Chalmers has also been talking about what
Speaker 3: the tariffs mean. He has revealed that he directed Treasury
Speaker 3: to do modeling on the possible consequences of trade tensions.
Speaker 3: We have.
Speaker 5: We actually did a bunch of work with the Treasury
Speaker 5: and other colleagues before the election, anticipating either outcome, and
Speaker 5: I've had the ability to brief my colleagues on a
Speaker 5: number of occasions.
Speaker 3: Over the past few months. We've had work being done
Speaker 3: by the Trade Department. Also, we've had Penny Wong as
Speaker 3: a Foreign Minister, talked to Marco Rubio. We've had this
Speaker 3: mission now by the Defense Minister, the Deputy Prime Minister
Speaker 3: Richard Miles to talk to Pete Heigseeth, the Defense Secretary
Speaker 3: of the United States. It's all like this, three ministers
Speaker 3: going out as soon as possible to say, well, we
Speaker 3: don't need to do this.
Speaker 2: Guys.
Speaker 1: Can you give an idea of what the trade relationship
Speaker 1: is like between Australia and the US.
Speaker 3: As it stands, trade with the United States is worth
Speaker 3: seventy seven billion US dollars annually and you know within
Speaker 3: that fifty two billion dollars to the United States and
Speaker 3: they've brought back twenty five billion dollars. So there is
Speaker 3: a surplus situation here. Australia is one of the top
Speaker 3: four nations in the world with a surplus. And it
Speaker 3: doesn't make economic sense. This is the message from the
Speaker 3: Albanese government. It doesn't make economic sense to slap tariffs
Speaker 3: on us. And look what we're talking about here. We've
Speaker 3: got to take a step back and go, hey, why
Speaker 3: are we even talking about this. You know, Australia is
Speaker 3: a long term political strategic ally of the United States. Well,
Speaker 3: as Don Farrell tells me in the interview that we had,
Speaker 3: it's not just about Australia. He'll be actually advocating for
Speaker 3: the United States not to do what it's currently doing
Speaker 3: to China, which is this tariff war that's emerging.
Speaker 4: Oh, there's no doubt that can increase in Chinese terrorists
Speaker 4: to the United States would have an impact in Australia.
Speaker 3: That means a lot to Australia because Australia's largest trading
Speaker 3: partner by far as China.
Speaker 4: But we would be advocating for no terrorists on Chinese products.
Speaker 1: So Don Farrell is more concerned about how they will
Speaker 1: impact China and the knock on effect that we'll have
Speaker 1: for Australia's relationship with China in a trade sense.
Speaker 3: Yeah, it's a rare argument that Australia would go into
Speaker 3: bat for such a large superpower, But there is self
Speaker 3: interest there and that you know, this could slow demand
Speaker 3: for big ticket items such as iron ore. You know
Speaker 3: that iron ore is what we sell to China, is
Speaker 3: a significant part of Australia's budget. This is something that
Speaker 3: could raise prices for goods from China. This could affect inflation,
Speaker 3: It could raise prices of goods here in Australia.
Speaker 4: But not to say don't do it to ours something
Speaker 4: we have a strong argument I think as to why
Speaker 4: they shouldn't do it to US, but we're saying, look,
Speaker 4: free and fair trade is not just in Australia's interest,
Speaker 4: not just in China's interesting, but in the longer tournament's
Speaker 4: in the interests in the United States.
Speaker 3: So when you finally get to have a chat with
Speaker 3: girl soon to be counterpart, that would.
Speaker 2: Be one of your main messages.
Speaker 3: This should be a very simple argument that Australia is
Speaker 3: putting forward.
Speaker 2: But it's very hard to say how things are going
Speaker 2: to go.
Speaker 1: Coming up after the break. Who's better at handling Trump,
Speaker 1: labor or the coalition? Karen the Trade Minister's meeting with
Speaker 1: his US counterpart, Patty Wong, has met with hers. Richard
Speaker 1: Miles has been doing the same. But we recently spoke
Speaker 1: to Malcolm Turnbull on seven AM. He said, the only
Speaker 1: relationship that really matters is the one between the PM
Speaker 1: and Trump himself. So what's Albanezy doing to prosecute Australia's case.
Speaker 3: Well, at the moment, and remember we're not in the
Speaker 3: official campaign, but essentially we're in campaign mode and so
Speaker 3: he's been very guarded when he's been asked about Trump.
Speaker 3: He's been very pointed saying that he's not going to
Speaker 3: run a daily commentary on daily actions from Donald Trump
Speaker 3: and all his decisions. But he does cite that there
Speaker 3: is a quad meeting due in June. That's the leaders
Speaker 3: of the United States, Japan, India and Australia, and so
Speaker 3: that would happen after the election, which must be held
Speaker 3: by May seventeen.
Speaker 2: But you know, he's very much leading it to the
Speaker 2: ministers at.
Speaker 3: This stage while he concentrates on the domestic campaign. I
Speaker 3: don't think he wants to start some sort of fight
Speaker 3: with Trump in the middle of a domestic campaign.
Speaker 2: So let's leave it to the ministers.
Speaker 1: The coalition is claiming they would be better place to
Speaker 1: handle our relationship with the US. So how did the
Speaker 1: coalition fair dream last truck presidency?
Speaker 3: Yeah, so, referring to Malcolm Turnbull, you know he often
Speaker 3: says that he got Trump's measure, even though you know
Speaker 3: there's the power of the United States presidency. He says
Speaker 3: he stood his ground and he's not afraid now that
Speaker 3: he's not Prime Minister anymore, to say that he is
Speaker 3: a bully.
Speaker 1: Trump is a bully.
Speaker 3: He encourages people to suck up to him, you know, notoriously.
Speaker 3: I didn't do that. I mean, that was partly my
Speaker 3: personality and partly circumstance.
Speaker 1: But I think it was a good thing.
Speaker 3: But you know, we certainly Dutton Peter Dutton says that
Speaker 3: the Coalition and Trump have a lot in common and
Speaker 3: they could work really well together. But don Farrell immediately
Speaker 3: scoffs at the suggestion that that is reality, and he
Speaker 3: points to the China situation in that the whole relationship
Speaker 3: with Australia's largest trading partner blew up under the Scott
Speaker 3: Morrison Prime ministership when he questioned the origins of the
Speaker 3: COVID nineteen pandemic and that led to like twenty billion
Speaker 3: dollars in trade sanctions against Australia, of which Australia is
Speaker 3: just getting over, still recovering. Don Farrell says that he's
Speaker 3: in fact got nine meetings with his counterpart. Things are
Speaker 3: going swimmingly and this is part of this message to
Speaker 3: the Australian public in that what the government has done
Speaker 3: with China, Farrell says that the government will do with
Speaker 3: the United States.
Speaker 1: Karen, how much harm could Trump's love of tariffs end
Speaker 1: up doing, not just to America's training partners like Australia
Speaker 1: and China, but to the United States itself.
Speaker 2: Well, I did speak to Justin Wolfis about it.
Speaker 3: He's a professor of economics and public policy at the
Speaker 3: University of Michigan. He's an Australian who's used to be
Speaker 3: on President Biden's Bureau for Economic Research. He just says,
Speaker 3: we know exactly what he's doing in that these US
Speaker 3: threats are to get exactly what he wants. He's thoroughly protectionists,
Speaker 3: and so far it's working, so Canada, Mexico, and Colombia
Speaker 3: back down within days. But it's ultimately self defeating and
Speaker 3: that when you're talking about like self interest. Ultimately you
Speaker 3: might be getting your foreign policy aims, but at the end,
Speaker 3: there's a United States consumer who's experiencing increased prices in
Speaker 3: the middle of a cost of living crisis that is
Speaker 3: going to bite. So, you know, he describes it as
Speaker 3: Trump is basically punching the American consumer in the mouth.
Speaker 3: At first, it looks like Donald Trump is getting a win,
Speaker 3: and that's very important to the United States president. But
Speaker 3: you know that would have to play out over a
Speaker 3: period of time, and you know, the administration only goes.
Speaker 2: For four years.
Speaker 1: Is that all Karen? Thank you so much for your time.
Speaker 2: Thank you.
Speaker 1: Also, in the years today, the federal government has committed
Speaker 1: more than half a billion dollars to women's health, including
Speaker 1: spending on long term contraceptives and menopause treatments. The government
Speaker 1: has also added some of the most popular contraceptive pills
Speaker 1: to the Pharmaceutical Benefit Scheme, a move that will lower
Speaker 1: the price of the drugs, benefiting an estimate of fifty
Speaker 1: thousand women. And Australia has paid the United States an
Speaker 1: eight hundred million dollars down payment for its future submarine
Speaker 1: production as part of the Orcus Agreement. In a meeting
Speaker 1: with Australian Defensive Minister and Deputy Prime Minister Richard Males,
Speaker 1: US Defense Seestry Peter Hexath said US President Donald Trump
Speaker 1: is aware of and supportive of ORCUS. The agreement is
Speaker 1: expected across Australia up to three hundred and sixty eight
Speaker 1: billion dollars over thirty years. I'm Daniel James. This is
Speaker 1: seven am. Thanks for listening.