Australia warns of trade war, pushes for Trump tariffs exemption

Australia Sunday warned against tit-for-tat retaliation and the outbreak of a trade war that could slow global economic growth, as it pushed to be excluded from U.S. President Donald Trump's steel and aluminum tariffs.

Canberra has sought to be exempt from the hefty tariffs, citing an understanding reached with the United States at G20 meetings last year.

There are also local industry concerns that the tariffs could see cheap steel destined for the U.S. flood the domestic market instead.

"We've seen... over the last 48 hours commentary from Canada, from the European Union. We've seen the U.S. government going back about tariffs on cars," Trade Minister Steve Ciobo told Sky News Australia Sunday.

"That's what concerns me, if we continue to see an escalation of rhetoric, and, ultimately, action around tariffs applying for imports and exports across multiple economies... this will lead to a slow-down in growth."

Ciobo said he spoke with his U.S. counterpart Wilbur Ross Saturday, but was unable to secure an exemption guarantee, adding that it would "ultimately... come down to a decision of the president".

A U.S. official said Friday no countries will be exempt, but added that possible exemptions to the measures would be considered on a case-by-case basis.

The minister said Canberra would use existing anti-dumping measures if cheap products flood the Australian marketplace as a result of the Trump tariffs.

But he would not comment on whether his government would retaliate directly against the U.S. if the administration moved forward with its plans, only saying that a trade barrier in principle "doesn't make good policy sense".

Prime Minister Malcolm Turnbull spoke out strongly against import barriers Sunday, calling it a "dead end".

"Protectionism is not a ladder to get you out of the low-growth trap, it is a shovel to dig it a lot deeper," he told reporters in Sydney.

Ciobo said Friday Australian steel and aluminum only accounted for a small percentage of the U..S import market, but warned the tariffs would distort trade and lead to a loss of jobs.

Fears of a global trade war and counter-measures grew over the weekend, after Trump threatened the European Union's auto industry if it enacted retaliatory measures to his steel and aluminum sanctions.

The European Commission chief's Jean-Claude Juncker said Friday that the EU was drawing up measures against leading U.S. brands such as Levi's and Harley-Davidson.