Treasurer issues grim message on economy if trade war takes hold

ABC NEWS (Australia)

Donald Trump's tariffs are slowing global economic growth and driving up inflation, according to the latest OECD outlook. The Treasurer Jim Chalmers says the world has entered an era of uncertainty and it's playing havoc with the federal budget.

Transcript

00:00At Rio Tinto's Queensland aluminium smelter, dealing with global forces can be a precarious

00:10balancing act.

00:11We are going to make Australian steel and aluminium the best in the world.

00:16Now searching for new markets after Donald Trump's decision to slap 25% tariffs on metal

00:23imports.

00:24Disappointing, unnecessary, senseless and wrong.

00:28Treasury estimates the direct hit from these tariffs will be modest, 0.02% of GDP.

00:35But this is just the first round.

00:37The indirect GDP impacts of a trade war could be up to four times larger than the direct

00:43impacts of tariffs on our own economy.

00:46Whether it's tariffs, a slowing Chinese economy or wars in Europe and the Middle East.

00:52This is a new world of uncertainty.

00:54There's disruption at every turn.

01:01It's against this backdrop that Jim Chalmers will next week hand down his fourth budget

01:06with deficits as far as the eye can see and fewer surprises this time around on budget

01:12night.

01:13In keeping with the theme, the Prime Minister will speak with his Canadian counterpart Mark

01:17Carney this evening, a man who's arguably bearing the brunt of Trump's tariff fury.

01:23He was determined to maintain a narrow focus on the economy, contrasting its approach with

01:29that of its political opponents.

01:31We will be seeking a mandate at the next election to keep Australians safe.

01:35Having opposed the voice to parliament, Peter Dutton has proposed another referendum.

01:40This time giving the government absolute power to deport criminal dual nationals.

01:46Shadow Attorney General Michaelia Cash later downplayed it, saying a referendum would only

01:51be a last resort.

01:53Her former colleague was less restrained, George Brandis calling it mad with no chance

01:59of success.

02:00All options are on the table, but we haven't announced that policy.

02:04This is another thought bubble from Peter Dutton.

02:07And that's making some Liberals nervous.

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