Trump Proposes 12.5 Per Cent Tariff on Australia

US Proposes 12.5 Percent Tariff on Australian Goods Over Slavery Concerns

You woke up to some disturbing news today - the US is proposing a 12.5 percent tariff on Australian goods. The Trump administration has accused Australia of failing to prevent slavery, claiming the country is not doing enough to stop forced labour.

An investigation by the US Trade Representative, Jamieson Greer, found that Australia had failed to impose and effectively enforce a forced labour import prohibition. This led to the proposal of the new 12.5 percent tariff, which would be in addition to the existing 10 percent tariff. The investigation also found that 54 countries, including China, Vietnam, and Japan, were subject to this same tariff.

But Australia is pushing back. Trade Minister Don Farrell said, 'Australia maintains our position that any tariffs on Australian exports to the United States are unjustified and inconsistent with our free trade agreement.' He also claimed Australia has robust legislation addressing forced labour and modern slavery.

So, what does this mean for Australia? Beef exports, which are a major Aussie industry, would be exempt from the new tariff. Other food items, metals, and certain fuels and chemicals would also be spared. But other goods, like textiles and machinery, would face the 12.5 percent tariff.

The issue of modern slavery is a major concern, with an estimated 50 million people globally trapped in conditions of forced labour. Australia's anti-slavery commissioner, Chris Evans, warned in January that the country faced a growing risk of becoming a dumping ground for goods made with forced labour. In fact, modelling from Fair Supply, a supply chain risk intelligence platform, estimates that more than 21 percent of all goods brought into Australia last financial year were linked to supply chains where coercion, debt bondage, and other forms of modern slavery occur.

And this is not a problem limited to Australia. Many countries, including the US, Canada, and the EU, are introducing import bans on goods made with forced labour. The UN Committee on Economic, Social and Cultural Rights has also called on Australia to introduce mandatory human rights due diligence under the Modern Slavery Act.

Australia's government is scrambling to understand the implications of the proposed new tariff. They believe it would not add to the existing 10 percent tariff. This means that, if imposed after a consultation period, Australian exports would move from a 10 percent to a 12.5 percent tariff rate.

The existing 10 percent tariff on all countries, including Australia, imposed by the Trump administration in February is set to expire in July.

The US Trade Representative's move comes at a time when Australia is already facing concerns about its treatment of refugees and asylum seekers. The country has been criticized for its hard-line stance on offshore detention centers. Australia's Trade Minister, Don Farrell, said, 'We continue to use every opportunity to advocate that US tariffs imposed on Australia are unwarranted.' It's clear he's got his work cut out for him, with the US Trade Representative proposing a significant increase in tariffs on Australian goods.