US threatens Australia and New Zealand with tariffs
Sydney (5 June)
The Office of the US Trade Representative (USTR) has proposed that the US impose a new 12.5% tariff on 54 countries – including Australia and New Zealand – for failing to ban imports produced using forced labour.
Six other countries that fail to effectively enforce bans should face a new 10% tariff, USTR said on 4 June.
The agency will consult on its proposal until 6 July, before making any decisions on new tariffs.
“The failure of our most important trading partners to address the importation of goods made with forced [labour] is unacceptable. This creates a dynamic where American workers are forced to compete globally on an [uneven] playing field,” US Trade Representative Jamieson Greer said.
Australian Prime Minister Anthony Albanese has opposed USTR’s proposed tariff on Australian goods and rejected its forced labour findings.
“Any tariff on Australian exports to the United States [is] unjustified; they’re inconsistent with our free trade agreement,” Albanese told ABC. “Australia has robust, comprehensive and world-leading legislation addressing forced labour and modern slavery,” Albanese added.
But Australia’s Anti-Slavery Commissioner believes that the country’s Modern Slavery Act is failing to prevent exploitation.
“Modern slavery remains embedded in global supply chains, including those connected to Australia. While the Modern Slavery Act 2018 ... has shone a light on these risks, the Act’s reporting-based framework has not delivered the meaningful action or real-world change,” the Anti-Slavery Commission said in January.
New Zealand’s Government has also opposed USTR’s proposal. The agency is looking for a way to legally reintroduce tariffs imposed by President Donald Trump in April 2025, which were later struck down by the US Supreme Court, New Zealand Trade Minister Todd McClay told Ryan Bridge TODAY, a daily news show.
“[USTR is] just finding ways to put back that tariff regime that the President campaigned on. And we, along with every other country of the world, [are] caught up in this, McClay said.
US consumers bought 4.2% of Australia’s exports and 12% of New Zealand’s exports in 2024, data from the Observatory of Economic Complexity (OEC) show. Meat and edible animal products accounted for approximately 27% and 29% of Australian and New Zealand exports to the US, respectively, in 2024, according to the OEC.
By Avinash Govind