Trump tweets Turnbull: Australia off the hook on tariffs

Malcolm Turnbull says there is no new

Malcolm Turnbull says there is no new"security agreement

President Donald Trump said Friday that he was working on a security agreement with Australia that would exempt that country from planned tariffs on steel and aluminum imports.

"He is committed to having a very fair and reciprocal military and trade relationship".

In discussions with their counterparts, Australian representatives have emphasised potential damage to domestic defence capability if trade barriers were to hurt the steel industry, arguing it is in American interests to protect the capacity of a key ally.

Australia has been lobbying hard for an exemption based on national security grounds, as Mr Trump promised "great partners and military allies" may sidestep the tariffs.

Turnbull soon replied with his own tweet, saying Australia had "no closer ally" than the US. "We have a trade surplus with Australia".

He disagreed with Mr Trump's belief that trade wars are good.

Trump suggests Australia may be exempt from tariffs
Aust tariff exemptions 'partial win' only

According to The Australian, Australia exports $US210 million in steel and $US213 million in aluminium to the U.S. each year. "We will be doing something with them".

Australia is believed to have been singled out after business leaders and politicians strongly lobbied the USA administration to exempt Australian steel and aluminium from the tariffs.

United States commerce secretary Wilbur Ross said national security under the relevant legislation was "defined to include economic security, it's defined to include effect on employment, it's defined to include effect on individual industries, so it's not the conventional definition of national security".

Trump initially said Canada and Mexico were the only countries granted exemption from the tariffs, but that was conditional on the two countries conceding to America's demands on other trade issues. "We have been working on this matter for some time".

"We will hold off the tariff on those two countries (Canada and Mexico) to see whether or not we are able to make the deal on NAFTA", Mr Trump said.

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