Australian Treasurer Jim Chalmers and former Prime Minister Kevin Rudd are leveraging Australia's $4 trillion pension industry in a lobbying effort aimed at avoiding tariffs imposed by the Trump administration. The trip seeks to secure an exemption from the 25% tariffs on Australian steel and aluminum products announced by the Trump administration.
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02-26, 2025Chalmers met with U.S. Treasury Secretary Scott Bessent on Tuesday morning (earlier today, Australian Eastern Standard Time). He described his meeting with Bessent as "very constructive" and stated that, combined with other high-level ministerial meetings between Canberra and Washington, it was a "good sign" for Australia, especially in the early stages of Trump's return to the White House.
Speaking at the Australian Superannuation Summit, Chalmers said that Australia's partnership with the United States "has never been more important," highlighting Washington's 2:1 trade surplus with Australia and the investment strength of the pension industry. The message he conveyed to the Trump administration was that Australia has imposed zero tariffs on U.S. imports since 1952, and approximately half of Australia's exports are imports used in the U.S. production process.
Chalmers further pointed out that Australia can supply 36 of the 50 minerals that the U.S. has classified as critical for advanced technologies and defense purposes. Through the AUKUS security pact, Australia is undertaking its responsibilities while strengthening its own defense capabilities. Australia is already one of the top ten foreign investors in the United States and possesses trillions of dollars in long-term, friendly pension capital, ready to invest in future opportunities.
Rudd earlier emphasized the power of Australia's growing pool of pension funds, which are projected to increase from $2.7 trillion ($4.2 trillion AUD) to approximately $7 trillion by the end of the next decade. He compared Australia's pension pool to the Norwegian fund, Singapore's sovereign wealth fund, and the sovereign wealth funds of the UAE and Saudi Arabia, highlighting that Australia's pension size exceeds the sum of all these funds.
Rudd also advocated for Australia to be seen as the next financial services hub in the Indo-Pacific region, calling it an "island of strategic stability" in challenging times. He emphasized that Australia is a "friend in all seasons" to the United States, and recalled that Australia has participated in every major war the U.S. has been involved in since World War I.
Bessent, in remarks primarily aimed at a domestic audience, did not comment extensively on his meeting with Chalmers, but did not appear to temper the Trump administration's enthusiasm for tariffs. He stated that President Trump is seeking to end international economic imbalances that weaken U.S. economic security, export American industry, and empower bad actors. Tariffs are an important part of this strategy, primarily aimed at achieving three goals: increasing U.S. industrial capacity, increasing government revenue, and correcting and managing "internal imbalances in other economies."
According to data from the United Nations Comtrade database, Australia's steel exports to the United States are approximately $378 million ($237 million AUD) and aluminum exports are approximately $503 million. Former Prime Minister Malcolm Turnbull negotiated a tariff exemption during Trump's first term, and the Albanese government faces pressure to repeat this feat, but early indications suggest that U.S. leaders and their supporters may be less willing to agree to another exemption.
