What's Labor's Top Priority Following Their Election Victory?

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Addressing the risk posed by global economic challenges is the top priority for the government, according to Treasurer Jim Chalmers, following an early briefing with the Treasury secretary just after Labor’s notable election triumph.

Chalmers mentioned on ABC’s Insiders program that he had a conversation with Treasury head Steven Kennedy at 6:45 am, where they discussed potential impacts on Australia amid tense US–China dynamics, including the shifts in financial markets and their implications for the domestic economy.

He labeled this concern as the government’s “primary focus.”

“We understand that the direct effects on us from the [US] tariffs are manageable and somewhat limited,” Chalmers informed Insiders.

“However, there is considerable risk looming over the global economy. The ongoing US-China situation indeed casts a significant shadow over international economic conditions.”

A man in a black suit standing in front of a coat of arms background.

In March, Treasurer Jim Chalmers said there would be a $42 billion budget deficit next year. Source: AAP / Jono Searle

In April, Australia’s growth outlook was slashed by a major international body as US President Donald Trump’s sent markets into a tailspin.

The International Monetary Fund said uncertainty had reached unprecedented levels and downgraded Australia’s economic growth projection for 2025 from 2.1 per cent in January to 1.6 per cent.

If the agency’s predictions unfold, about $13 billion would be shaved off Australia’s economy.

Markets rebounded after Trump announced impacting exporters in most countries.

The federal government has also been working to secure a tariff exemption, like it did during Trump’s first term.

The Treasurer expressed the government’s “realistic” perspective on the possible global impacts of Trump’s tariffs but also shared a positive outlook on Australia’s resilience, which includes implementing local policies such as renewable energy initiatives and housing improvements.

Announcing the federal budget earlier this year, Chalmers said there would be a $42 billion budget deficit next financial year and referred to global trade disruptions and wars in Ukraine and the Middle East amid .

Earlier this week, Albanese downplayed concerns Australia could face an economic downturn.

“Our administration has overseen growth every quarter since we took office, a contrast to many other advanced economies,” he remarked.

The Australian Industry Group has congratulated Albanese and Labor on winning a second term but said Australian businesses face immense challenges in the coming months.

“This is the toughest time in a generation to be a business,” the group said.

“Each day sees more global trade disruption, greater market intervention, the building of trade barriers and the risk of global conflict. As a trade-expressed economy, we will not be immune to the consequences of the rapidly changing global landscape.”

In his victory speech on Saturday evening, Albanese referred to global challenges but said his government would address these issues “the Australian way” by “looking after each other while building for the future”.

— With additional reporting by the Australian Associated Press.

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