Will international laws affect the way Aussies shop soon? Lecturer shares his thoughts
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Australians are no strangers to the ebb and flow of the global economy.
In return, these changes could impact everyone's daily lives—from the price of petrol to the cost of a loaf of bread.
Yet, recent developments in international trade could have a more significant effect on everyone's wallets in the most unexpected way possible.
United States (US) President Donald Trump recently rolled out a series of tariffs across the world, and Australia is not immune to the consequences.
David Leaney, a lecturer at the Australian National University's College of Business and Economics, spoke about the potential fallout from Trump's tariffs on our prime exports, including beef, steel, and aluminium.
Despite any efforts from the Australian government to secure exemptions, Aussies could feel a pinch on their wallets soon.
'You can't quarantine the impact of tariffs just to one area,' Leaney explained.
'The bad news is that there is an impact on Australian consumers' cost of living from Trump's love affair with tariffs.'
The severity of this impact is still up for debate, but history offered some insight into the looming changes.
In 2018, then-Prime Minister Malcolm Turnbull celebrated an exemption for Australian steel.
However, Leaney suggested that this victory was more symbolic than substantial.
With only a tiny fraction of Australia's steel exports going to the US, the exemption did little to shield our economy from the broader effects of the tariffs.
When Trump targeted Chinese steel, it led to a reduction in production.
This reduction meant that China bought less Australian iron ore.
'China adjusted its supply to match the demand and didn't really get hurt,' Leaney said.
'The one that got hurt was Australia because it really impacted our iron ore exports to China. So, when you're trying to hurt Country A, it's Country B that often ends up hurt.'
Trump's proposed tariffs included a 25 per cent tariff on most imports from Mexico and Canada, which former Canadian Prime Minister Justin Trudeau criticised as 'd***'.
Additionally, many Chinese goods were also subjected to a 10 to 15 per cent tariff, with the possibility of an increase to 20 per cent across the board.
Trump also suggested reinstating a 25 per cent tariff on all steel and aluminium imports to boost US production and protect local jobs.
While these measures might be aimed at bolstering the American industry and workforce, they could also lead to higher steel prices in the US due to the inability to manufacture exports as cheaply as China.
That is when Australians might start to feel the pinch.
As tariffs drive up manufacturing costs in the US, the price of goods imported into Australia could also rise.
Everyday items inside supermarkets could see a price increase.
The cost of Australian exports might also climb as tariffs make Australian products less competitive on the global market, potentially leading to a decrease in demand and a subsequent hit to the economy.
In addition, superannuation funds may take a hit due to these tariffs implemented by the United States government.
Learn more about the possible changes here.
So, what can consumers do this time?
It's essential to stay informed about these international developments and understand how they might affect daily expenses.
Have you noticed any changes in the prices of your regular purchases? Are you concerned about how these international laws affect your cost of living? Share your thoughts and opinions with us in the comments below.
In return, these changes could impact everyone's daily lives—from the price of petrol to the cost of a loaf of bread.
Yet, recent developments in international trade could have a more significant effect on everyone's wallets in the most unexpected way possible.
United States (US) President Donald Trump recently rolled out a series of tariffs across the world, and Australia is not immune to the consequences.
David Leaney, a lecturer at the Australian National University's College of Business and Economics, spoke about the potential fallout from Trump's tariffs on our prime exports, including beef, steel, and aluminium.
Despite any efforts from the Australian government to secure exemptions, Aussies could feel a pinch on their wallets soon.
The price of supermarket goods may rise soon due to massive changes in US laws. Image Credit: Pexels/Gustavo Fring
'You can't quarantine the impact of tariffs just to one area,' Leaney explained.
'The bad news is that there is an impact on Australian consumers' cost of living from Trump's love affair with tariffs.'
The severity of this impact is still up for debate, but history offered some insight into the looming changes.
In 2018, then-Prime Minister Malcolm Turnbull celebrated an exemption for Australian steel.
However, Leaney suggested that this victory was more symbolic than substantial.
With only a tiny fraction of Australia's steel exports going to the US, the exemption did little to shield our economy from the broader effects of the tariffs.
When Trump targeted Chinese steel, it led to a reduction in production.
This reduction meant that China bought less Australian iron ore.
'China adjusted its supply to match the demand and didn't really get hurt,' Leaney said.
'The one that got hurt was Australia because it really impacted our iron ore exports to China. So, when you're trying to hurt Country A, it's Country B that often ends up hurt.'
Trump's proposed tariffs included a 25 per cent tariff on most imports from Mexico and Canada, which former Canadian Prime Minister Justin Trudeau criticised as 'd***'.
Additionally, many Chinese goods were also subjected to a 10 to 15 per cent tariff, with the possibility of an increase to 20 per cent across the board.
Trump also suggested reinstating a 25 per cent tariff on all steel and aluminium imports to boost US production and protect local jobs.
While these measures might be aimed at bolstering the American industry and workforce, they could also lead to higher steel prices in the US due to the inability to manufacture exports as cheaply as China.
That is when Australians might start to feel the pinch.
As tariffs drive up manufacturing costs in the US, the price of goods imported into Australia could also rise.
Everyday items inside supermarkets could see a price increase.
The cost of Australian exports might also climb as tariffs make Australian products less competitive on the global market, potentially leading to a decrease in demand and a subsequent hit to the economy.
In addition, superannuation funds may take a hit due to these tariffs implemented by the United States government.
Learn more about the possible changes here.
So, what can consumers do this time?
It's essential to stay informed about these international developments and understand how they might affect daily expenses.
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