LATIKA M BOURKE: Don Farrell confronts Jamieson Green on tariff hike, reveals surprise windfall for Australia

Trade Minister Don Farrell says Donald Trump’s tariffs have delivered a “surprise windfall” for Australia, but has told his US counterpart overnight that the latest proposal to slug producers with extra duties is unjustified.

The Trump administration is threatening to raise tariffs again, claiming forced labour has been used in Australian goods.

If followed through, the US would increase the tariffs on Australian goods from 10 per cent to 12.5 per cent from July 24.

Previous exemptions to beef and gold would still apply for Australia.

The US is targeting some 60 countries, including Australia, citing forced labour standards, a charge the Australian government rejects.

Speaking to the Council of Foreign Relations, President Trump’s Trade Representative Jamieson Greer praised Australia as a “deficit country” in comparison to the European Union.

But he said he was interested in seeing which countries were willing to enforce labour standards before any concessions were granted.

“That’s what we’re doing as we go along to these countries. We’ve had consultations with — I think it’s — you know, I think it’s upwards of forty countries on this issue over the past few weeks. Many of them have shown an interest in adopting these kinds of laws we have,” Mr Greer said.

“We have literally dozens of countries that are interested in implementing these types of laws. That’s a good start. Really what matters is, are you actually effectively enforcing these laws?

“It’s not really a situation where a country can come to me and say, hey, I implemented this law, I’m golden. It’s, you know, I think we want to see sustained, effective enforcement of such laws. The laws themselves need to be, you know, sufficient. And then they need to be enforced effectively over a given period of time.”

Australia does not accept that it has been lax in enforcing labour standards.

Tariffs drive win for Australia

Minister Farrell met with Mr Greer on the sidelines of the OECD’s meeting of trade and foreign ministers in the French capital on Wednesday.

Speaking exclusively to The Nightly in Paris, he said that while he continued to press for the tariffs to be lifted, they had not been bad for Australia and in fact had delivered a “surprise windfall for us.”

“This is the big surprise, so the trade for the United States went up 67 per cent last year,” Mr Farrell said.

“Now, you might say, well, how is that possible they’ve imposed tariffs on us? How was it that we could be increasing our trade? The answer to that is that on Liberation Day, Australia was given the lowest tariff of any country in the world.

“Our competitors all had higher tariffs. So in a competition situation, our imports were cheaper than the countries that we would normally compete with.

In 2024, Australian goods exports to the US were valued at $24.4 billion. By 2025, Australian exports to the US had increased to $40.6 billion, according to government figures.

Asked if he had anticipated this outcome, he said: “No, no, I just assumed — the normal effect of the tariff (is) you apply a tariff because you want to import less of that product, and that is normally how it works, but because other countries received higher tariffs in this particular situation, it was a benefit to Australia.”

He did not express confidence of having the tariffs removed by the time Mr Trump’s term ends in January 2029, but said: “We haven’t given up.”

“I don’t think you can make too many predictions about what will happen except to say I think the world is now an increasingly uncertain place for trade, and the only prediction I think that you can make about the future is that unpredictability is going to continue,” he said.

“Just when you think things are returning to normal, stabilising and everything’s under control, something else happens, and I think we have to accept the proposition that for the time being, that’s the way the world of trade is going to work.

“Our argument has been and will continue to be that in the end the tariffs will prove counterproductive for the American economy,” he said.

“And we continue to prosecute the argument that they should be removed.

“That’s especially important in the case of Australia, because the trading balance is so much in America’s favour, makes no sense to be applying a tariff to a country where you’ve got twice as much trade as Australia.”

He said Australia had been nimble and had adapted, including by signing a trade deal with the EU, which he predicted would be ratified as soon as this time next year.

He rejected outright Coalition calls to renegotiate the deal announced in March, because of concerns the EU could punish Australia if it ever left the Paris Climate Agreement, under the terms of the FTA it has signed.

“That’s a furphy, what they have raised. Australia and Europe are both committed to the Paris agreement, and that’s simply reflected in our current policy,” he said.

“Our job is to implement that agreement, not to renegotiate it”