A week out from the August 1 tariff deadline, Donald Trump appears to be getting some trade deal wins on the board. Australia has acquiesced on beef biosecurity, Japan has made concessions; like agreeing to open its economy to imports of trucks, rice and other agricultural goods, as well as agreeing to invest $US550 billion in the US economy in order to secure a 15 per cent tariff deal. At the same time, Europe looks set to lock in an agreement with the US. But honorary professor at ANU, Dr Jenny Gordon, says while Donald Trump may be able to use the clout of the US to extract concessions out of other nations, he's not getting great outcomes for his country. However, she says it's unlikely the US president will budge on the baseline 10 per cent tariff, as he has some economists backing him on this approach, called 'optimal tariff theory', which means if you're a big country that has a lot of market power, you can actually put a tax on the exporters that are trying to access your market and they will pay some of that tax. Dr Gordon says, as a revenue raiser, that tariff needs to be around 10 per cent.
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