The federal Treasurer is warning Australia can not escape the effect of a trade war. President-elect Donald Trump will re-elect the white house with a mandate for tariffs, and China is a main target. Jim Chalmers says the consequences will hit Australian shores.
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00:00Donald Trump's trade message being heard around the globe.
00:06Trade is around half of the Australian economy.
00:09So we know that we need to make this work for us, not against us.
00:13The Treasurer is sounding a warning.
00:15Australia's inflation battle won't be helped by a trade war.
00:19We won't be immune from the consequences of any trade war that happens in our region or
00:25around the world.
00:26It would be a significant casualty if it became this global kind of retreat from trade.
00:33Donald Trump will take the White House promising two trade strikes, 10 to 20 per cent tariffs
00:38on almost all American imports and tariffs of up to 60 per cent on goods from China.
00:44There could be retaliatory trade measures across different countries, so that's likely
00:50to push prices up.
00:51We're confident that we will do what Australia has always been able to do, which is to work
00:56with American friends, no matter who is leading either country.
01:00Australian officials have modelled the impacts, forecasting a small hit to GDP and a bump
01:06in prices.
01:07That inflation comes from Canberra, not from the United States, and this Treasurer today
01:12is looking for another excuse.
01:13So it doesn't necessarily mean that we won't get rate cuts, but they might not be as large
01:18as they would have been if there was no change in the trade situation.
01:22Jim Chalmers has started to gain some ground on efforts to combat inflation, even if hopes
01:27of an interest rate cut before the election are starting to dim.
01:31A Trump trade war could dash those hopes altogether, and provide a convenient place to park some
01:37blame.