US defends placing tariffs on uninhabited islands

The US Secretary of Commerce, Howard Lutnick, has stood by the government’s decision to impose tariffs on the remote Heard and McDonald Islands, which are uninhabited except for populations of penguins and seals.

Read more: “Nowhere on Earth is safe”: Trump's tariffs hit Antarctic islands, home only to penguins

According to Lutnick, this move, aimed at closing "ridiculous loopholes," is intended to prevent other countries from using these islands as a transit point to ship goods to the US.

In an interview with CBS, Lutnick explained that the tariffs are designed to stop nations from exploiting the islands to gain access to the US market. He stated, "If you leave anything off the list, the countries that try to basically arbitrage America go through those countries to us. The President knows that, he's tired of it, and he's going to fix that."

The announcement of the tariffs took Australian authorities by surprise, as the islands are located approximately 4,000 km from Australia. Australia's Trade Minister, Don Farrell, expressed his concerns to ABC, labeling the tariffs as "clearly a mistake" and suggesting that the decision-making process was "rushed."

Lutnick's comments came as part of a broader defense by US officials following a sharp decline in the stock market, with all three major US indices dropping more than 5 percent on Friday, marking the worst week for the market since 2020. The tariffs are part of US President Donald Trump's ongoing efforts to protect American interests in trade.

Transshipment, the practice of shipping products from one port to another, is a common method in global trade. However, the Pew Charitable Trusts, a public policy organization, cautioned that this practice can allow "bad actors to obscure or manipulate data" related to shipping activities. The organization estimates that hundreds of millions of dollars worth of tuna and similar species are illegally transported each year in the western and central Pacific using these methods.

Export data from the World Bank indicates that imports from the Heard and McDonald Islands to the US have historically been minimal, with a notable spike in 2022 when the US imported USD 1.4 million worth of products, predominantly classified as "machinery and electrical" items.

In addition to the Australian islands, Trump’s tariffs list includes the British Indian Ocean Territory, which is primarily occupied by military personnel and requires a permit for visits. According to World Bank data, this territory exported USD 414,350 to the US in 2022.