Source: Australian Attorney General’s Agencies

Andrew Clennell: Joining me live now is the Trade Minister, Don Farrell. Don Farrell, thanks for your time. Well, let’s talk about this first meeting with Donald Trump the PM is scheduled to have this week. Do you expect the meeting to occur and what do you expect to happen?

Minister for Trade: Look, we’ll see what happens this time next weekend. You’re very obviously up to date with all of the latest and it sounds like you’re going to be there Andrew, so we can watch you report on it.

Andrew Clennell: What do you think the response from the PM will be if Donald Trump echoes Pete Hegseth’s call for more defence spending?

Minister for Trade: Look, one of the most important, or perhaps the most important obligation of any Federal Government is the defence of our country and Anthony Albanese and Richard Marles and our government take those responsibilities very, very seriously. We’re committed to the AUKUS program. In fact, the weekend before last, just before I went to Europe for the trade talks, I met with the UK Defence Industries Minister in Adelaide, with the Premier, and we endorsed, and re-endorsed Australia’s support for the, for the AUKUS submarine project. So, we are committed to the defence of this country. We are committed to a significant uplift in the, in the amount of spending. As you said, that’s going to be a project worth more than $360 billion. So, I think we’ve talked the talk here, Andrew. We are committed to the defence of this country and we are committed to increasing our spending to ensure that Australia stays safe in our region.

Andrew Clennell: What did you make of the way that Pete Hegseth put that on Richard Marles at the Shangri-La dialogue and then released a statement concerning the request or the demand, putting the 3.5 per cent figure on that public statement?

Minister for Trade: Look, the Americans will do what they want to do. That’s certainly the case in a whole range of areas now. But we have an excellent Defence Minister in Richard Marles. He’s very focused on ensuring that all of our defence capabilities are as strong as they can be and as strong as they need to be. We’re focused on what Australia needs to do and we’ll make our decisions based on what is in our national interest.

Andrew Clennell: Well, on trade, the Opposition’s made a bit during the week while you’re away in Paris, we’ll get to that in a minute, but they made a bit of the fact that the UK have secured a 50 per cent reduction on steel tariffs. Why aren’t we getting the same? Or can we get the same? What do you make of that? I mean, you met Jamieson Greer, the US Trade Rep, last week. Were there any signs out of him we could get a deal on steel?

Minister for Trade: Look, I did meet Jamieson Greer. I met him twice. And that’s on top of previous conversations I’ve had with him. The position I’ve put to Jamieson Greer is that the tariffs that the United States have imposed on Australia are unjustified. America has a trade surplus with Australia. Just to put that into perspective, trade between the United States and Australia is roughly $100 billion a year. That’s $70 billion worth of product we buy from the United States and $30 billion worth of product we sell to them. Now, that’s overwhelmingly in the United States favour. So, there is no justification for the United States to impose tariffs on Australia. So, the position I’ve put to Mr Greer, and I put it twice last week, is that we want all of the tariffs removed, not just some of them. We want all of them removed. And I made it clear to USTR Greer that we’ll continue to press for the removal of all of those tariffs.

Andrew Clennell: You talk about the trade surplus, isn’t it the case that because of these tariffs, in April, it was a deficit reading here. Australia exported 2.29 billion in goods to the US while importing 3.99 billion in April?

Minister for Trade: Well, that’s my point, Andrew. We are buying more from the United States than we’re selling to them. So, it doesn’t make any sense at all to impose a tariff on Australia. So, the argument that I’ve made, and I’m sure the Prime Minister will be making every opportunity that he gets, is we want all of these tariffs removed, not just some of them. 

Andrew Clennell: How did Jamieson Greer react? Did he give any sort of hint to you that, oh, we could move on this, or was it like, this is the President’s position and tough luck.

Minister for Trade: Look, he certainly made it clear that these are ultimately decisions that the President of the United States will make, but look it was a friendly discussion. It wasn’t a difficult discussion in terms of the relationship between us. I’m certainly of the view that we have the opportunity to continue to talk with Jamieson and Commerce Secretary Lutnick to put our case across that these tariffs on Australia are simply unjustified. We don’t imply, you know, we haven’t applied tariffs to the United States. We could do that. We could have done that. We’ve chosen not to do that. In the same way you might recall when I first came to this job, Andrew, we had $20 billion worth of tariffs and impediments imposed on us by China. We didn’t retaliate on that occasion. And bit by bit, we managed to get all of those tariffs that had been applied on Australia by China removed. I’d like to do the same with the United States. It’s only by open discussion, honest discussion with our allies in the United States that I think we can do that. But I certainly haven’t given up on the prospect of getting these tariffs removed. And every opportunity I get, I’ll continue to pursue that argument with the United States. At the same time, of course, we’re looking for –

Andrew Clennell: Well, from what you’re saying, Don Farrell, about what Jamieson Greer said to you, it’s all down to Albo, if I can use his nickname. Because he’s saying to you that it’s the President’s decision, it’s his call, and our Prime Minister’s the one about to potentially to meet Donald Trump. So, it shapes as a pretty critical meeting, doesn’t it?

Minister for Trade: Look, every meeting, I think, between an Australian Prime Minister and the US President will always be a critical meeting. And I have the greatest confidence in our Prime Minister to push the Australian point of view on this issue. But look, there’s a range of ways in which we communicate with the United States. Ambassador Rudd obviously does it. All of our Ministers who make contact with their equivalents in the United States make it clear what we want out of the relationship with the United States. And of course, most importantly, as you say, is the relationship between our Prime Minister and the President of the United States.

Andrew Clennell: Are you expecting, if there isn’t a breakthrough here, further tariffs? Because there’s talk about Donald Trump making further decisions, certainly in relation to the UK at least, July 9 Liberation Day. So, perhaps rather than trying to get the 10 per cent off, it’s about the steel tariffs, but also about preventing even further action, this meeting, if it occurs, isn’t it?

Minister for Trade: Look, the main topic at our discussions at the WTO and the OECD last week were on this very topic, Andrew, ensuring that there is a way that countries don’t increase the amount of protectionism. We advocate very strongly for free and fair trade. The way in which we have achieved our prosperity in this country is through that free and fair trade. And I think there’s a mood around the world to push the case for less protectionism and more free and fair trade. I took the opportunity last week to talk with my European counterparts. I met the French Trade Minister, the German Trade Minister, and of course, the most important one in that is the European Trade Minister. We had good discussions. My officials spent a couple of days after the meeting continuing those talks. I’m hopeful that those countries around the world who do believe in free and fair trade can reach agreement to extend free trade agreements across the globe, so that irrespective of what the Americans might choose to do, we have a greater diversity of trading partners.

Andrew Clennell: What do you think’s been the effect of the Trump tariffs thus far on the Australian economy and the world economy?

Minister for Trade: Look, there’s no doubt that it’s had an impact. When you impose those sort of tariffs, it’s inevitably going to impact growth. This is one of the arguments that we make to the Americans. If you want to grow your economy, the way to do it isn’t to impose tariffs, it’s to be engaged actively in free and fair trade. And so the more you impose tariffs, the greater impact that you have on your own economy and the world economy. And what we’re seeing now, of course, is the outcome of some of these policy decisions. So, I think it’s incumbent on Australia, on the rest of the world, to say to the Americans, look, these are exactly the wrong policies to adopt. You should be adopting the opposite policies. You should be opening up your economies. What we know is if you’re an outward facing trading company in Australia, your profits are going to be higher, but more importantly, the wages of your employees are going to be higher. So, we say to the Americans, and will continue to say to the Americans, these are the exact wrong policies to adopt.

Andrew Clennell: Donald Trump has announced talks overnight between US and Chinese officials on Monday in London. Are you hoping for progress there? And how bad for Australia could this sort of US Tariffs on China situation get?

Minister for Trade: Yeah, so I, while I was in Europe, of course, the speculation was that the Chinese and the Americans would quickly meet to discuss these issues. I met with my counterpart from China, Wang Wentao, that was our 10th meeting, and he’s made it very clear that just as we have done, they want these tariffs removed. So, I think that’s a very good sign and we would welcome any development that restored the free trade arrangement between the United States and China. And we would encourage those discussions. I know from talking with my Chinese counterpart, they’re very keen to get these tariffs removed. And these tariffs do have an impact, as you say, Andrew, on Australia. It’s one thing for the Americans to impose a 10 per cent tariff on Australia. But when they’re imposing those tariffs on other countries around the world that we trade with, that we sell our resources to, well, then that also has an impact on our economy.

Andrew Clennell: Can you confirm what I’ve just reported that Australia apparently did come close to securing some kind of exemption from Donald Trump’s tariffs in April with a deal on critical minerals. And there was an indication from some sections of the US Administration to our officials that an exemption could be forthcoming, and then it all fell apart.

Minister for Trade: Well, I’m not sure it’s all falling apart, Andrew. We continue to encourage the United States –

Andrew Clennell: But Don Farrell, just on the key point here, were we close to a deal? Did people in the administration put us in a position where we were thinking a deal might be closed back then before that April announcement?

Minister for Trade: Oh, look, Andrew, I’m not going to speculate on what might or might not have occurred had the circumstances been a little bit different, but I can certainly confirm that Australia pushed very hard for an exemption. And in the process of pushing very hard for that exemption, we did offer an expanded arrangement in terms of critical minerals. Australia is the lucky country, we have either the largest or the second largest of reserves of critical minerals. We have the technology to extract those critical minerals, and we are a reliable trading partner. So, we thought that in all of those circumstances, that would be an offer that would be attractive to the United States.

Andrew Clennell: Was Kevin Rudd taking the lead in that? Was Kevin Rudd taking the lead in that as our ambassador?

Minister for Trade: Kevin Rudd, of course, was involved in all of these discussions, as he should be. And he’s doing a very good job, I might say, in his communications with the US Government. But all of us, Madeleine King, our Resources Minister, myself, we have been all encouraging the United States to take up our offer to expand our relationship on critical minerals. Other countries are doing it. We’ve got an agreement now with the European Union, the Japanese, the South Koreans are all interested. The Singaporeans are interested in our critical minerals. We think we’ve got something to offer.

Andrew Clennell: Sure.

Minister for Trade: In that regard, the quality and our ability to extract –

Andrew Clennell: How damaging to Australia in terms of this tariffs issue, do you think this Peter Navarro is? 

Minister for Trade: Look, the Americans pick their advisors and we pick ours. My job is to continue to explain to the Americans firstly that the policies that they’re adopting are exactly the wrong policies to produce prosperity in the United States. So, we’ve got to continue to argue that point. And I think as time goes by, it’ll be increasingly obvious that these policies are the wrong policies. And secondly, my job is to convince the Americans that they shouldn’t be imposing tariffs on, firstly, a good ally to the United States like Australia, and secondly, that these tariffs are unjustified given the surplus situation that we have with the United States. 

Andrew Clennell: Sure. In May, Donald Trump also threatened a 100 per cent tariff on foreign films. Is that coming, do you think?

Minister for Trade: Look, I’m not sure where that’s up to at the moment. Again, we would strongly argue that the United States not do that. One of the reasons why America has looked to Australia in the area of film production is during COVID and the post-COVID period, we were able to deliver services, great quality filmmaking, when that wasn’t possible in the United States. So, we haven’t done this simply to benefit the Australian film industry, we’ve done it to benefit the American and the world film industry because we were able to produce wonderful films using all the latest technology. And that’s been a benefit to the United States film industry. Something that couldn’t have happened without Australia being engaged in this. So, again, we would say this is the wrong policy. We have got a good film industry in Australia. It’s an expanding film industry. They produce beautiful films. In fact, last week I went to the 50th anniversary of Sunday Too Far Away and met Jack Thompson. We’ve got a wonderful history of making films in this country.

Andrew Clennell: Yeah, well, good actor. But look, I’m out of time here Don Farrell, I just want to ask one question which is pretty important I suspect, and that’s about the Paris talks with the EU on a trade deal. Are there any sticking points remaining? Are we taking off a luxury car tax in exchange for allowing our beef exports into the EU? Is there still issues of the use of the word prosciutto and parmesan? Could we be producing so called Australian made parmesan soon? And do you expect all this to be finalised for a visit by the European Commission President Ursula von der Leyen in July or August?

Minister for Trade: Look, all of those things you’ve just mentioned, Andrew, are still issues. We haven’t yet got an agreement, but there was a lot of goodwill in the air in Paris last week. I’m confident that if that goodwill continues, that we can secure a new free trade agreement with the European Union. You know, there’s 450 million people, trillions of dollars of GDP in Europe. We’ve got lots of things that we can sell to the Europeans. I believe now that there’s an appetite to reach an agreement on both sides. The world has changed. Those countries that believe in free and fair trade have to work together, and I’m very confident, Andrew, that with a little bit of time, a little bit of hard work on our part, because it’s not going to be easy. If it was easy, somebody else would have done it. But we can get there and we can strike an agreement.

Andrew Clennell: Trade Minister Don Farrell, thanks so much for your time.

Minister for Trade: Good to talk to you, Andrew.

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