Australia’s internal trade policy is in danger of being disrupted by a trade war that could result in Australia becoming the second nation to have its currency and its laws targeted by international trade sanctions.
Key points:Australia’s trade regime includes international trade restrictions and a national security interest defence article Australia is a key trading partner for countries including China and Russia, and is one of the biggest exporters of foreign exchange to these nations, with its currency the Australian Dollar.
The exchange rate for the Australian dollar, the Australian Sterling and the Australian Trillium are affected by the imposition of trade sanctions by the United States and the European Union.
“If the United Kingdom and the United Nations come to Australia and try to impose sanctions on our financial institutions, it will be extremely difficult for our trading partners to comply,” Australian Treasury secretary Steven Ciobo said on Thursday.
“Our trading partners will see this as a major blow to their ability to export and trade goods and services around the world.”
The move is part of an effort to stop China from dominating global trade and the impact of the sanctions could be felt far and wide, as Australia’s dollar fell to its lowest level since December 2017, and a number of Asian countries imposed currency controls and trade restrictions.
“This is a significant blow to our international trade,” Australian Reserve Bank (ARI) Governor Chris Williamson said on Tuesday.
“We’ve had significant restrictions on trade for over a year and now the U.K. and the EU are putting their thumb on the scale.
This is a major step in the direction of our trading relationships with China.”
It comes after Australian Prime Minister Scott Morrison said on Wednesday that he would “fight” for Australia’s economic sovereignty after the U of A announced it would impose sanctions against the Australian currency and impose trade restrictions on banks.
Australia has been one of three countries in the EU to impose trade sanctions on Chinese firms and individuals, with the United Arab Emirates (UAE) and Japan also sanctioning them.
Ciobo said that he was worried that the trade sanctions could affect the currency, and that if they were successful, it could lead to Australia becoming one of two nations affected.
“The exchange rates for the AUD and the AUS are affected when these sanctions are imposed, so it is very likely that the trading partners that are affected will not be able to compete,” Ciobo told ABC radio.
“What is also of concern is that the UAE and Japan have both put their thumb up to prevent the trade between their countries.”
Ciobi said he believed the sanctions would be difficult to enforce, but the consequences would be severe.
“It is a very serious thing that will affect our financial system, our economy and our trade,” he said.
“That will be a real problem for the whole world, especially in relation to the economic and financial stability of Australia and Australia’s ability to be a trading partner.”
“We cannot do this without the international community and that’s why we need the United Nation to step in and step up and act.”
The Australian government’s responseTo Ciobo’s comments, the government said it would respond to the trade policy and the implications of the trade war.
“These measures are a clear signal to China that we are serious about our obligations under international trade agreements,” a spokesperson said in a statement.
“Australia is a critical trading partner and we are fully committed to a free and open global economy and free trade.”
Australia’s currency has been on a decline in recent months and has fallen to about 70 US cents in early trading.
It fell to about 75 US cents earlier this week, a level not seen since December.
The trade agreement between Australia and the Commonwealth of Australia, known as the Trans-Pacific Partnership (TPP), was struck in February this year.
The TPP was signed in July and is aimed at opening up trade between the United.
States and 11 other nations including Australia.
The U.S. is one party to the agreement.
The Australian Government has said that it is prepared to make changes to its trade policy to comply with the sanctions if they are imposed.
Cihos decision to launch the probe comes after the Australian government announced on Thursday it would launch a review of its trade relations with the EU.
“Under the current rules, Australia has no formal trade relationship with the European Free Trade Association (EFTA),” the government’s statement said.
The EU is Australia’s largest trading partner, accounting for about 80 per cent of Australian exports and imports.