Doorstop interview: US tariffs on steel and aluminium

JASON CLARE: Thanks for coming along and welcome to Bankstown. Well some good news today. Today our time, President Trump has confirmed that Australia will be exempt from the tariffs he’s putting on steel and aluminium and that’s good news. It’s great news and we welcome it. I congratulate the Government and the officials who have been working hard to secure this exemption for Australia. We deserve it and we should get it. We’re America’s closest ally. One of their very best friends. Earlier this week I urged the Prime Minister to pick up the phone and talk to Donald Trump directly about this and that’s happened today. It’s helped lead to this good result. There’s one more thing I’d urge the Prime Minister to do and that is to put in place the resources and the extra powers we need to make sure that extra steel and aluminium doesn’t get dumped here in Australia, costing Australians their job - because although we are now exempt from these new tariffs on steel and aluminium being imported into the United States, other countries aren’t. There’s a real risk that steel or aluminium that’s produced in China or South Korea or Brazil or Russia or anywhere else that was originally destined to the US might now be re-diverted and dumped at below cost price in Australia.

Last week the Anti-Dumping Commissioner said that this was a real risk. He said that if the Americans put extra tariffs on steel and aluminium there’s a risk that more steel and aluminium will be dumped at below cost price here in Australia. That’s why yesterday Bill Shorten and I announced that there are a number of things we should do to protect Australians and safeguard Australian industry from this. One, is to beef up resources to the Anti-Dumping Commission to provide them with about an extra 30 staff, an extra investigative team, to investigate cases of dumping. Also beef up the penalties, triple the penalties for companies that are dumping steel and aluminium in Australia.

There are about 12,000 companies in Australia that are part of the steel and aluminium supply chain. There’s over 100,000 Aussies who work in those businesses and it’s important that we safeguard their jobs. Yesterday BlueScope welcomed that package and said it was the right thing to do. So did Capral, so did Manufacturing Australia and I’d urge the Prime Minister to pick up that plan and implement it. It’s not about playing politics, it’s not about criticising the Anti-Dumping Commission. I set up the Anti-Dumping Commission – it’s a great organisation. But there’s an increased threat now with the risk of steel and aluminium destined for America being redirected here and so I’d urge the Prime Minister to pick up that plan and implement it as soon as possible.

Happy to take questions.

JOURNALIST: What could the President mean by his tweet suggesting Australia and the US are working on a security agreement?

CLARE: Look we’ll have to wait and see what the details of that agreement are but from what the President has said, from what the Prime Minister has said, it looks pretty certain that we have secured an agreement here that Australia will be exempt from those tariffs. Now that’s good news for Australia, I welcome it. It’s good news for BlueScope and other Australian companies that export to aluminium to the US. It’s also good news for Americans because it means they’re not going to have to pay more for a house or pay more for a car because if you jack-up tariffs on steel and aluminium it increases the cost of a lot of goods in America. So I welcome that but there’s still more to do and the big threat to us now is that some of that steel from other countries, that was destined for America might get redirected here at below cost price, threatening jobs in local Australian companies that make steel and aluminium.

JOURNALIST: The PM has fiercely denied any security agreement was discussed during their private talks. Do you believe it’s something the US is still eyeing off at some point?

CLARE: I have no more detail other than what we’ve seen in the President’s tweet and what we’ve heard from the Prime Minister today but we look forward to seeing more detail in the days ahead.

JOURNALIST: How likely is it that America will request something in return for this Australian exemption down the track?

CLARE: Again we have no more detail on that. Australia deserves this exemption. I said in this same park earlier this week that if Canada and Mexico are going to be exempt from these tariffs then so should Australia. If the basis for the exemption is national security then America’s closest ally and best friend should also get this exemption and now we’ve got it, that’s terrific, but there’s one more thing we need to do and that is safe guard the jobs of steel makers and aluminium makers here at home. The way to do that is to beef up the powers and the resources of the Anti-Dumping Commission so that we’re ready, just in case more steel and aluminium gets dumped here in Australia in the weeks ahead.

JOURNALIST: Do you anticipate that Australia will be asked to increase its military numbers in the Middle East or partake in freedom of navigation operations in the South China Sea?

CLARE: We have no more details other than what we’ve heard today from the President and the Prime Minister but we’ll await with interest.

JOURNALIST: Do you think that Malcolm Turnbull deserves some congratulations or some praise? He’s obviously worked very hard in the last week to make this happen.

CLARE: Well I’ve just congratulated the Government. I congratulate the Government I congratulate the Ministers that have worked hard on this. Julie Bishop has been in the US, Steve Ciobo last week was talking to his counterpart the Commerce Secretary. There’s a lot of Australian officials which go unmentioned and I want to congratulate them too. This has been a lot of work by a lot of Australians to make this happen.

Remember the Prime Minister was promised this exemption back in the middle of last year by the President. They’ve made good on that promise and that’s terrific. But what I’d say is there is one more thing we need to do and that’s make sure that steel from other countries that aren’t exempt from this, doesn’t get dumped here in Australia because if it does we know what happens. Steel gets dumped here at below cost price. Aussie companies can’t compete with that so they lose out, they lose contracts and the workers they employ lose their job.

JOURNALIST: As you mentioned there this was mooted last year and we apparently had an agreement last year that Australia wouldn’t be impacted. Is it disappointing that it’s taken until the eleventh hour for that to be locked in?

CLARE: Look I am just happy with the result. It’s taken a lot of work but we’re here and we’ve got it. So I congratulate the Government. This is good news but we can’t rest on our laurels. This is not the only thing we need to do. We’ve got the exemption, we also now need to make sure that other countries that also produce steel, that don’t get this exemption, don’t send their steel and their aluminium at below cost price. That’s what dumping is and if that happens then that’s a risk to Australian jobs in those 12,000 companies that are part of the steel and aluminium supply chain.

JOURNALIST: Look you acknowledged a risk of dumping and that’s certainly something to watch out for but isn’t there a greater risk that Europe and China will retaliate and that will have a detrimental impact on the global economy and what should Australia be doing about that?

CLARE: You’re right. This is a real risk. If we get involved in tit-for-tat tariff increases, where America jacks up tariffs and Europe responds by jacking up tariffs or Asia gets involved in jacking up tariffs then that just leads you in one direction and that’s towards a trade war. No-one, no-one wins a trade war. So I’d urge cool heads to prevail here. We don’t want to see this metastasise into a trade war. The best thing that everyone can do is look at this very calmly and realise the lesson of history here.

When you go down the path of jacking up tariffs it leads to recession. It led to the Great Depression. We’re here in Paul Keating Park – Paul Keating and Bob Hawke were the leaders of Australia that cut Australian tariffs and that helped create the modern strong economy that we’ve got today. So the lesson of history is that if you want to create more jobs, if you want more growth and development then you cut tariffs, you don’t increase them.