Jim Chalmers:
It’s been a brief visit here to Washington D.C., but an important one. I’ve had the opportunity to meet with the CEOs of Blackstone, Citi, and JP Morgan. I’ve been able to speak at the Superannuation Summit convened by Ambassador Rudd and also, of course, meet this morning with Treasury Secretary Scott Bessent and also the Director of the National Economic Council, Kevin Hassett.
What I wanted to say about that was it augurs well for Australia’s relationship with the US that so soon in the life of a new administration here, we’ve already had the Foreign Minister, the Deputy Prime Minister and the Defence Minister and now the Treasurer meet with their counterparts here in Washington D.C., and of course that builds on the very productive conversation that Prime Minister Albanese had with President Trump.
I think it augurs well the kind of access that we’ve been able to have here in Washington D.C. at the start of a new administration and at a very important time, a time of great uncertainty in the global economy. I was very grateful to Secretary Bessent and Director Hassett for making time this morning. We met for about an hour or so over breakfast at Ambassador Rudd’s residence. It was a constructive conversation. It was wide‑ranging, it was positive, and it was productive.
We were able to continue, but not conclude, the important discussions that President Trump and Prime Minister Albanese had around 2 weeks ago or so. The discussion was wide‑ranging, encapsulated critical minerals, the flow of capital, but also, of course, trade and tariffs. That’s where we were able to continue but not conclude the discussions between the leaders of our 2 countries. I was able to make the case for Australia.
When it comes to the exemption that we seek from tariffs on steel and aluminium, Australia has a different case to make than other countries who have been the focus of the administration. The Americans run a very substantial trade surplus with Australia. They have done since the Truman administration in the 1950s. That trade surplus is 2 to 1. At the same time, Australia’s got a free floating currency. We don’t manipulate our currency. We’ve got a very productive relationship between the steel and aluminium sectors in both countries. Our products are often an input into domestic production here. Bluescope and Rio and others make big investments in the US as well. We’ve got a different story to tell than other countries here in Washington D.C. when it comes to our case, to be exempted from these tariffs on steel and on aluminium as well.
We’re also a very willing and long‑standing defence partner. Secretary Bessent has previously written about the fact that the closest allies often make the best economic partners. And that’s certainly the case when it comes to this relationship. The relationship between Australia and America in economic terms is full of mutual benefits, shared interests and big opportunities. Our discussions were about maximising those opportunities in the interests of the people of 2 great countries.
If you think about the economic performance of our 2 economies, these are in lots of ways the standout performers in the world. That’s because we’ve been able to make progress on inflation without seeing substantially higher unemployment in our economy. That’s another thing that we have in common between Australia and the US. In Australia, we’ve got lower inflation, higher wages, low unemployment, we’ve got the debt down, and now interest rates have started to be cut at the same time as well. That means we are an exception to what is happening in lots of other places around the world. Of course, the American economy has made progress on inflation as well at the same time as they’ve been able to keep unemployment low. If you compare the Australian economy with the American economy, our inflation is lower, our interest rates are now lower, and our debt to GDP and our underlying cash balance to GDP are both lower as well – and that’s a good thing.
I’m looking forward to getting home later this week. It’s going to be a very big week for the economy. On Wednesday, Australian time, we will get the monthly inflation data. This data will show again the very substantial and now sustained progress that we’re making on inflation. This will be the sixth consecutive [month] where inflation, in a monthly sense, has been within the Reserve Bank’s target band. This progress that we’ve made together on inflation has given the Reserve Bank the confidence to cut interest rates for the first time in some years. That interest rate relief that Australians are now getting is the interest rate relief that they need and deserve. After all the progress that we’ve made together on inflation.
We’ll also get the National Accounts data next week, which will give us a good sense of how our economy finished at the end of last calendar year. It will be a reminder that although we have had soft growth in our economy, we’ve still got a productivity challenge in our economy. Our people are still under pressure. We have made a lot of progress together domestically and we’ve made some progress as well here in the US on this visit.
Journalist:
Was there any discussion about what happened last time when Australia apparently exceeded a voluntary commitment that it had given not to explore beyond a certain level of aluminium? And did you give any assurances that that sort of thing won’t happen again this time?
Chalmers:
No, it didn’t come up.
Journalist:
What’s left to discuss? Why haven’t you been able to conclude those discussions on an exemption for Australia?
Chalmers:
As I said before I left Australia, our expectation was that we would have an opportunity to make our case on steel and aluminium. We didn’t expect to conclude that conversation. And what we were able to do today in that important meeting that we had with Secretary Bessent and Director Hassett was to point out all of the ways that Australia is exceptional when it comes to their considerations. We greatly value that opportunity. It was a really constructive conversation. It was wider‑ranging than just steel and aluminium, but it was positive and productive.
Journalist:
Treasurer, many Australians back home might be legitimately concerned that even threatening steel and aluminium tariffs on Australia is unfair treatment of such a close economic and strategic partner over such a long period of time. What’s your message to Australians concerned about whether the US is downgrading the relationship with Australia? Are they right to be concerned, and is America still, still reliable?
Chalmers:
I think 2 things about that, Joe. First of all, we’re here standing up for the workers and industries of Australia, making the case to our American friends that this is a relationship of mutual economic benefit. The reason that we are pushing for this exemption from the tariffs on steel and aluminium is because we genuinely believe an exemption to be in the interest of both countries.
More broadly, I think the alliance and the economic partnership between Australia and the US is as strong as it’s ever been. A demonstration of that is the really quite extraordinary enthusiasm and interest in both directions when it comes to our superannuation funds. It is a remarkable public policy miracle that in a country which has the 52nd, I think, biggest population in the world, the 13th biggest economy in the world, we’ve got the fourth biggest pool of pension funds. When you look at all of the things that we bring to the table in this important relationship of mutual benefit, the fact that we’ve got hundreds of billions and soon trillions of dollars of Australian superannuation invested in the American economy is yet another demonstration, a powerful demonstration, of the closeness of that.
Journalist:
But is the US as reliable as it was? That’s the question.
Chalmers:
I’ve got no reason to believe otherwise. The conversations that we had today, which were positive and productive and constructive, they reflected the vast opportunity in this economic relationship. And if you think about the conversations that are being held at the Superannuation Summit, again, those conversations are a powerful demonstration of the, not just the mutual benefit in the relationship, but what Australians bring to the table. Hundreds of billions of dollars, trillions of dollars of investment in the American economy in support of the administration’s objectives. Manufacturing infrastructure, data and digital, critical minerals capital flows. Australia’s got an important role to play here and I’m grateful for the chance to be able to lay it out.
Journalist:
Scott Bessent, the Secretary, said today it’s not his call in terms of the carve out for the steel for Australia. So, how much progress do you think you actually made in that meeting? Did you get a sense of which way the administration could be leaning?
Chalmers:
I think it’s well understood that at the end of the day, this will be President Trump’s call. I think that’s well understood in the administration and certainly in our government and in our discussions. My task here in DC wasn’t to try and conclude that discussion, it was to try and inform it, to make sure that the sorts of things that the administration here cares most about, the fact that Americans have zero‑tariff access to our own market, the fact that we don’t manipulate our currency, the fact that our industries are complementary rather than in competition with each other. That was my opportunity here, and I was pleased to be able to take it.
Journalist:
The Financial Times reports that senior White House officials were considering kicking Canada out of the Five Eyes alliance over tariffs. In your opinion, is it ever appropriate to compromise a security relationship like Five Eyes over an economic dispute?
Chalmers:
I’m reluctant to engage in the speculation that was in the Financial Times for obvious reasons. We work closely with our Canadian friends on intelligence, but much more broadly than that, Canada and Australia are obviously close partners as well. Without going into the specifics of that report, without knowing the source of that speculation, I would just point out that the Five Eyes community is a very, very important community for Australia and we would like to see its membership remain intact.
Journalist:
Treasurer obviously it was asked about. Secretary Bessent’s comments afterwards, he washed his hands of this. Did you know that was going to take place before?
Chalmers:
Was this on the way out?
Journalist:
On the way out he washed his hands of it, said it wasn’t going to be his decision. Did you know that coming into this meeting and you said it’s ultimately President Trump’s call, does that not mean the Prime Minister needs to lobby the President directly harder? If indeed it is the American Commander in Chief who’s going to be having a say in deciding if Australia gets tariffed?
Chalmers:
It was. It was clear to us before the meeting, during the meeting and after the meeting that this call will be made by President Trump on the advice of senior figures in his administration. I think that’s been self‑evident for some time, and that’s why the conversation that Prime Minister Albanese had with President Trump was so important. All of you would recall and would have seen that President Trump said that an exemption for Australia was under consideration. I think under great consideration, he said. I think that reflects the very obvious fact that the final call at the end of the day will be his.
That doesn’t mean that there’s not an opportunity for all of us to engage with our colleagues and counterparts here in DC, and again, I will come back to where I started. Few, if any, countries would have had their main economic Minister, Defence Minister, Deputy Leader, and Foreign Minister through town meetings with their counterparts. The administration is barely a month old. A number of our counterparts have only very recently been confirmed by the Senate. So, I think it does augur well for the partnership between our 2 countries the sort of access that we have been able to have here. That can only be a good thing as we make our case.
Journalist:
Is that suggesting to Australians, though, that the best way to actually deal with President Trump is not to deal with him directly but with an ally like Australia to deal with those closest to him?
Chalmers:
That’s not what I’m saying at all. There has been direct lobbying, direct discussions between Prime Minister Albanese and President Trump. Our job has been to continue and to inform those considerations and those discussions. I think any observer of the reports out of that Albanese–Trump conversation would come to conclude that it was a very productive one. The fact that President Trump made it very clear that an exemption is under consideration I think is a good thing for Australia. We take no outcome for granted. We’re not getting carried away by the progress that we have been able to make. At the end of the day, it will be President Trump’s decision, and that’s appropriate.
Journalist:
Since the President offered to consider granting that exemption, he’s obviously also been announced by such tariffs voting on non‑tariff barriers. Have you been given any indication as to whether that specifically talks about value‑added taxes? Have you been given any indication whether the GST or government’s work potentially on levying the tech giants could be wrapped up in that? And did you make a case to avoid those tariffs?
Chalmers:
Those issues didn’t come up today. We have said publicly before that when it comes to things like the news media bargaining code, that’s not a tax that we are hoping to levy. We’re hoping to see commercial deals done between media organisations, including American media organisations, including one that some of you work for. But that didn’t come up today. We made our position on that clear publicly on other occasions and nor did the discussions around the GST come up as well. If they had, I would have pointed out, as I have on other occasions, that the GST is non‑discriminatory. It applies equally to imports and to products and services generated in our domestic economy so it doesn’t meet the criteria of a trade restriction.
In the discussions today, we know that the things that the administration is particularly focused on are obviously tariffs, levies on American goods and services, non‑tariff barriers, currency manipulation, subsidies, and some of these issues around tax. But when it comes to Australia, we’ve got a very, very good story to tell on each of those 5 things which have been raised with us today and on other occasions as well. But tax wasn’t raised with us.
Journalist:
And just to be clear, so would your expectation be that when we get this report from the USTR, that there is nothing that impacts us?
Chalmers:
I don’t want to pre‑empt that for obvious reasons. I don’t want to pretend that I know the wording of the reports produced to the various deadlines. My job here was to establish a dialogue with the new Treasury Secretary and the new Director of the NEC. I’ve been able to do that. I also want to shout out in that regard Ambassador Rudd for the tireless work that he’s been doing on behalf of our country and our Cabinet to get us the kind of access that we have enjoyed here. To meet with 3 very serious CEOs, to meet with trillions of dollars of funds under management, to meet with the new Treasury Secretary only a few weeks after he was confirmed, to meet with Director Hassett. It doesn’t just augur well for the relationship; it’s an opportunity for which we are very grateful. Not every country has had that kind of access to date, and that can only be a good thing for Australia, our industries, our employers, and our workers.
We might just take 2 more. I’ll take Annelise and then I’ll come back to you.
Journalist:
Do we need the Prime Minister to come and make the case directly to the White House before these tariffs are implemented?
Chalmers:
The Prime Minister has made the case directly to President Trump. Obviously, the timing of any face‑to‑face discussions would be contingent on any other plans that the Prime Minister has over the course of the next few months. We’ve made it clear publicly and privately that President Trump is always welcome in Australia. Prime Minister Albanese would always be welcome here in the United States. But I’m not going to pretend I’m going to set out for you or plan out for you the Prime Minister’s travel.
Journalist:
The administration is obviously very interested in critical minerals. Are we offering something specific on that front as a bit of an incentive to do a deal here? And just secondly, did you try to get a meeting with Peter Navarro as part of this trip? He’s shaping up as a problem for us.
Chalmers:
I didn’t seek a meeting with him on this occasion. My meetings were with my direct counterparts. The 2 people must closely in my wheelhouse, Bessent and Hassett. Minister Farrell of course will have discussions when it’s appropriate with his counterparts and with the US Trade Representative when that’s appropriate, when that’s confirmed. In terms of critical minerals, that was a huge part of the conversation here – a very, very substantial part of the conversation here. That’s because of the 50 critical minerals that the US has listed as priorities, Australia has 36 of those. If you combine that with our advantages in super, the nature of the trading relationship and some of these other advantages, critical minerals are a big part of the story and they are a big part of the discussions. We are interested in advancing with them some more concrete proposals around ensuring a reliable supply of critical minerals into this economy. Given how reliant some of their sectors, technology, defence and other sectors are on the kinds of resources for which Australia is known.
Journalist:
Uranium. Is that on the table?
Chalmers:
We didn’t talk about uranium.
Thanks very much.