Omari Gates
Australia and the United States have a strong history of economic partnership, with the US being Australia's largest economic partner. The US-Australia Free Trade Agreement (AUSFTA) came into effect in 2005, and since then, two-way trade has grown by 138%. The US exports significantly more to Australia than Australia exports to the US, with US goods exports to Australia in 2024 being $34.6 billion and US goods imports from Australia totalling $16.7 billion. Australia's exports to the US are quite broad, and the country has a highly educated, multilingual workforce, a safe business environment, and strong trade links.
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Trade agreement
Australia and the United States have a strong history of trade and investment, with two-way trade valued at US$77 billion and an investment relationship worth US$1.6 trillion. The US is Australia's largest economic partner, and Australia is the District of Columbia's biggest trading partner.
The Australia-United States Free Trade Agreement (AUSFTA) came into force in 2005, and since then, two-way trade has grown by 138%. The agreement has eliminated tariffs on over 99% of manufactured goods exported to Australia, and 97% of non-agricultural exports to the US are now duty-free. The agreement has also opened markets for services such as life insurance and express delivery, and improved intellectual property protections.
The US and Australia have a mutually beneficial relationship, with Australian companies employing around 150,000 people in the US, and US exports to Australia totalling $34.6 billion in 2024. Australia's diverse and strong economy is reflected in its economic relationship with the US, with Australian companies operating in 83 different industries in California alone.
Australia is in a good position to avoid tariffs or minimise their impact, and its trade relationship with the US is stable. Australia's exports to the US are quite broad, and there is no specific industry that would benefit from trade restrictions on Australia. This broad composition of exports means that Australian exports can be readily redirected to other markets, although potentially at a lower price.
The US-Australia trade relationship is underpinned by a strong history of cooperation, mutual benefit, and free trade. The AUSFTA has been highly successful in increasing two-way trade and opening up markets, and the US and Australia have a record of working together to further economic prosperity.
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Trade imports and exports
The United States and Australia have a strong history of trade relations. The two countries have a free trade agreement, the AUSFTA, which came into effect in 2005. Since then, two-way trade has grown by 138%, from $32 billion to $77 billion. US goods trade with Australia was estimated to be $51.3 billion in 2024, with exports to Australia at $34.6 billion and imports from Australia at $16.7 billion.
Australia is a significant exporter of agricultural products to the US, with three-quarters of agricultural tariff lines eliminated under the AUSFTA. Australian exports to the US include processed foods, fruits and vegetables, corn, and soybeans. Australian wine and beef are also notable imports, particularly in California. In addition, Australian companies have access to the US federal government procurement market, as well as the procurement markets of 31 US states.
The US exports a variety of goods to Australia, with more than 99% of tariff lines for qualifying US manufactured goods exported to Australia being duty-free. This includes sectors such as life insurance and express delivery, as well as e-commerce and pharmaceuticals. The US also benefits from Australia's diverse and highly skilled workforce, with Australian companies operating in 83 different industries in California alone.
In terms of investment, the US and Australia have a strong relationship, with a total investment relationship valued at $1.6 trillion. Approximately a quarter of Australia's inward foreign investment is from the US, totaling $740 billion. Australian companies also employ around 150,000 people in the US, with notable investors including Woodside, Westfield, Brambles, and Atlassian.
Overall, Australia is a significant and trusted trading partner for the US, with a diverse range of imports and exports that contribute to the economic prosperity of both nations.
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Business environment
The United States and Australia have a strong history of trade relations, with the US being Australia's largest economic partner. The two countries have a free trade agreement (AUSFTA) that came into effect in 2005, which has resulted in a 138% growth in two-way trade, now valued at US$77 billion. The agreement has also reduced tariffs and opened markets for services such as life insurance and express delivery, improved protection of intellectual property, and facilitated American investments.
Australia has a diverse economy, reflected in its economic relationship with the US. Over 12,000 Australian companies export to the US, operating in 83 different industries in California alone. Notable Australian investors in the US include Woodside, Westfield, Brambles, Atlassian, Worley, Visy, Bluestone Lane, Rio Tinto, and Tritium.
Australia is an attractive location for business due to its strategic location, favourable time zone, and highly educated, multilingual workforce. Ranked in the global top five on the Index of Economic Freedom, Australia provides a safe and secure business environment for multinational enterprises.
In terms of trade, Australia runs a trade deficit with the US, importing more from the US than it exports. Australian exports to the US include miscellaneous manufacturing and pharmaceuticals, while US exports to Australia include processed foods, fruits and vegetables, corn, and soybeans.
Despite the strong trade relationship, Australia's trade flows with the US are relatively small compared to other US trading partners such as Canada, Mexico, China, and the EU. Australia's exports to the US are also quite broad, meaning there is no specific US industry heavily dependent on Australian imports. This diversity may provide some protection from potential trade restrictions or tariffs.
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Tariffs
Australia and the United States have a strong history of trade and investment, with the US being Australia's largest economic partner. In 2005, the Australia-United States Free Trade Agreement (AUSFTA) came into effect, and two-way trade has since grown by 138%, from US$32 billion to US$77 billion.
However, in 2025, the US announced new tariffs on imports from Australia and other trade partners globally. A 10% baseline tariff was imposed on most imported goods from Australia, with some goods subject to a higher tariff rate, and others exempt. For example, Australian steel and aluminium imports to the US are subject to a 50% tariff from 4 June 2025. These tariffs have naturally impacted Australian businesses, and the Australian government is working to analyse the effects of these US trade measures on Australian exporters.
The US has also launched investigations under the Trade Expansion Act 1962 to assess the impact of certain goods on US national security, including timber, semiconductors, and smartphones. The Australian Trade and Investment Commission (Austrade) provides support and information to Australian businesses through its Go Global Toolkit, which offers guidance on US tariff changes.
Despite the new tariffs, the US remains an important trade partner for Australia, and the two countries continue to work closely to promote economic prosperity through open trade.
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Job creation
The United States and Australia have a close and cooperative trade relationship, with two-way trade valued at US$77 billion. This relationship is underpinned by the Australia-United States Free Trade Agreement (AUSFTA), which came into effect in 2005. Since then, two-way trade has grown by 138%.
The US-Australia trade relationship has resulted in job creation in both countries. Australian companies employ approximately 150,000 people in the US, with around 19,000 in both California and Texas. US firms account for 335,400 jobs in Australia, with total wages of $38.8 billion, meaning that, on average, an Australian employee of a US firm earns over $115,000 a year.
The AUSFTA has also enhanced the trade relationship by eliminating tariffs on almost all manufactured and agricultural goods, as well as easing investment rules. This has made it easier for US companies to enter the Australian market and vice versa. Over 12,000 Australian companies now export to the United States, and Australian companies have access to the US federal government procurement market, valued at US$637 billion.
The US Commercial Service helps Australian companies find US suppliers and business partners and participate in trade shows. Similarly, it helps US companies do business in Australia by finding agents, distributors, and representatives for their products and services.
Both countries have highly educated and diverse workforces, with Australia's being multilingual. This, along with Australia's strategic location and favourable time zone, makes it an attractive location for US companies to do business in the Indo-Pacific region.
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Frequently asked questions
U.S. goods trade with Australia totaled an estimated $51.3 billion in 2024. U.S. goods exports to Australia in 2024 were $34.6 billion, and U.S. goods imports from Australia totaled $16.7 billion in the same year.
The US-Australia Free Trade Agreement, which came into effect in 2005, has resulted in the elimination of tariffs on over 97% of Australia's non-agricultural exports to the US. It has also opened markets for services such as life insurance and express delivery, improved intellectual property protection, and facilitated American investments by providing predictable access and a stable business environment.
While some sources suggest wine and beef, Census data shows that most Australian imports to Washington, D.C., are miscellaneous manufacturing and pharmaceuticals. Australia's exports to the US are quite broad, and no specific US industry would benefit significantly from trade restrictions on Australia.
Australia has a strong, diverse, and highly educated workforce, and its strategic location in the Indo-Pacific region makes it an attractive location for US companies. Additionally, Australia is not a target of the US trade war, which provides stability for US companies operating in the country.
Australia runs a trade deficit with the US, meaning the US exports more to Australia than it imports from Australia. Additionally, Australia's trade flows with the US are relatively small compared to other US trading partners such as Canada, Mexico, China, and the EU.
