Labor is making pressing representations to the White Home about Donald Trump’s risk to impose 200% tariffs on drug imports to the US, an announcement Jim Chalmers says could be very regarding for the Australian financial system.
The US president mentioned on Wednesday that the punishing new border levies would include a transition interval that might final extra no less than a yr, after sustained stress from the US pharmaceutical business over value controls on frequent medicine in international locations like Australia.
“We’ll be announcing something very soon on pharmaceuticals,” Trump mentioned.
“We’re going to give people about a year, year and a half to come in, and after that they’re gonna be tariffed if they have to bring the pharmaceuticals into the country at a very high rate, like 200%.”
Trump, who this week delayed the lifting of a pause on his so-called “retaliatory tariffs” towards greater than 100 international locations till 1 August, additionally introduced a plan to hit copper imports into the US with a 50% tariff.
Australia’s copper exports to the US are price about $50m yearly and make up lower than 1% of complete gross sales of the metallic.
However Australia exports about $2.5bn in pharmaceutical (primarily vaccines and blood merchandise) in addition to healthcare merchandise to the US every year – a share of about 40% of medicines exports throughout the globe yearly.
This week Guardian Australia reported a few of the most influential foyer teams in Washington had been pushing the US to retaliate towards Australia’s remedy of US exporters beneath the $18bn pharmaceutical advantages scheme, pointing to drug approvals and home manufacturing incentives as proof of unfair “freeloading”.
The PBS retains costs for almost 1,000 generally used medicines capped, with provide offers negotiated with drug corporations to make sure entry to life-saving medicine.
The treasurer mentioned the plan to impose tariffs on overseas prescribed drugs and copper had been “very concerning developments”.
“Our pharmaceuticals industry is much more exposed to the US market, and that’s why we’re seeking, urgently seeking, some more detail on what’s been announced,” Chalmers advised ABC radio.
“But I want to make it really clear once again, as we have on a number of occasions before, our pharmaceutical benefits scheme is not something that [we are] willing to trade away.”
Foyer teams together with the US Chamber of Commerce and the Pharmaceutical Analysis and Producers of America have advised the US commerce consultant, Jamieson Greer, that the system is discriminatory and “socialised medicine”.
after e-newsletter promotion
Chalmers mentioned rising world commerce tensions linked to Trump’s unpredictable and increasing tariff regime had been a “substantial concern” to Australia.
“It does pose a risk to the progress that the world has been making in our economies after Covid,” he mentioned.
“We’ve made it really clear on a number of occasions, these tariffs are bad for Australia. They’re bad for the US. They’re bad for the global economy.
“These developments, they are sometimes unpredictable. There’s been an element of volatility and uncertainty injected into the global economy.”
Trump this week despatched letters of demand to 14 US buying and selling companions, together with Japan and South Korea, warning them of the 1 August deadline.
Australia had not acquired a letter as of Wednesday, although Trump flagged then that extra letters can be despatched within the subsequent “short period of time”.
“As per letters sent to various countries yesterday, in addition to letters that will be sent today, tomorrow, and for the next short period of time, TARIFFS WILL START BEING PAID ON AUGUST 1, 2025,” he mentioned.
“There has been no change to this date, and there will be no change. In other words, all money will be due and payable starting AUGUST 1, 2025 – No extensions will be granted. Thank you for your attention to this matter!”
The US commerce secretary, Howard Lutnick, advised CNBC he anticipated the copper tariffs to be put into place as quickly as the tip of July or someday in early August.
