In the Pacific, some of the world’s poorest economies are reeling after discovering they too will be subject to tariffs from Donald Trump’s White House.
The US President unveiled global tariffs on imported goods on Thursday (AEDT), which he labelled “Liberation Day” for the American economy.
Fiji has been levied at 32 per cent, Vanuatu at 23 per cent, Nauru at 30 per cent, and bizarrely, the tiny Australian external territory of Norfolk Island was hit with a 29 per cent tariff.
That will mean the favourite bottled water of many Americans – Fiji Water – should get a lot more expensive.
Water makes up two-thirds of Fijian exports to the US, including the eponymous brand.
The USA is Fiji’s number one export market, with more than half a billion dollars worth of Fijian goods heading across the Pacific in 2024.
Should the tariffs lead to lower take-up of Fiji Water or other goods in the US, it will be a huge hit to the Fijian economy.
Fiji Prime Minister Sitiveni Rabuka is yet to comment on the tax slug.
Other nations – including Papua New Guinea, French Polynesia, Samoa, Tonga, Solomon Islands, Cook Islands, Kiribati and the Federated States of Micronesia – have been given a 10 per cent tariff.
For some countries, this will hurt more than others.
For instance, Tonga counts the US as its second-biggest export market, for Samoa, it is third, and Vanuatu, it is fifth.
However Solomon Islands, with a GDP of almost $A3 billion, exported goods worth just $A1.75 million to the US in 2024, making it the 17th biggest export market and of little significance.
Vanuatu is not as exposed to the US economy as Fiji, but is another nation to be hit with a higher tariff rate, making its products less competitive.
In New Zealand, Foreign Minister Winston Peters said the Kiwi rate of 10 per cent should be seen as a success from a recent diplomatic mission.
“We went to Washington DC to get the best possible result for New Zealand in the circumstances, by making strong, genuine, in-person connections with the US Administration,” he wrote on social media.
“The purpose of our mission has been achieved. Indeed, New Zealand companies, who were fearing much worse, are well positioned compared to exporters from other countries.”
Trade Minister Todd McClay called the imposition of tariffs “a significant development” but was looking on the sunny side.
“Tariffs have consequences for the global economy – impacting inflation, demand, currency stability, and economic growth,” he said.
“While these tariffs create additional costs that will largely be passed on to consumers, New Zealand is in a stronger position than many other countries, some who are facing higher tariff barriers.
“We will be talking with the (Trump) administration to get more information, and our exporters to better understand the impact this announcement will have.”
Australian Associated Press is the beating heart of Australian news. AAP is Australia’s only independent national newswire and has been delivering accurate, reliable and fast news content to the media industry, government and corporate sector for 85 years. We keep Australia informed.
