👉 Background: After Donald Trump's US election win earlier this week, countries around the world have been reflecting on what his American-first approach will mean for them. Although right now, there are “concepts of a plan”, it's likely that US-based companies will be receiving the red carpet treatment.

👉 What happened: The Governor of the Reserve Bank of Australia, Michele Bullock is expecting Trump to slap an extra 10-20% tariff on all Australian exports to the US as well as other “adverse effects” on Australia’s economy.

👉 What else: But that’s not the only impact on our economy, because Trump has spoken about even bigger tariffs of up to 60% on exports from China. So this presidency could hit Australia’s economy in more ways than one.

What's the key learning?

💡When tariffs rise, the ripple effect can often be felt far and wide. A 10% increase in tariffs in Australia probably won’t make a material impact to our economy, but a 60% tariff on China might impact us a whole lot more.

💡While Australian exporters sent $22 billion worth of goods to the US in the last financial year, we exported more than $219 billion worth of goods to China, like coal, iron and agriculture.

💡And Australian could face the domino effect.

• If Chinese goods become more expensive in the US, Americans are likely to buy less Chinese goods
• With less demand for Chinese goods, China is likely to import less raw material from Australia,
  

So there are a whole lot of reasons why Australia is vulnerable to changes in the US economic policy.