The problem for Australia is the lack of alternatives, that there's no real option to continue the status quo.
Australia's top 3 exports are iron ore, coal and gas.
Those paying close attention will be all too aware that we're starting to lose competitiveness in coal and no that isn't due to politics. It's just that the companies insist the mines run at a profit, miners are relatively well paid, the industry's somewhat bloated and that's running into geological reality of slowly but surely increasing extraction costs in real terms. Either the shareholders take a hit, the miners take a hit, efficiency is improved or we're going to see more like this:
The troubled Dartbrook coal mine has plunged into receivership and administration just months after it reopened following years of disuse.
Premier Roger Cook revealed to parliament that the government had so far made $182.7 million worth of payments from the $220 million support package for Griffin Coal.
I've intentionally linked to different media organisations and states there, trying to avoid any inference of politics or that it's only one media organisation saying it.
Now add in the well documented issues with housing and I'll suggest Australia's present economic model has essentially painted itself into a corner and is fast running out of room. It's that situation that leads many, including myself, to see manufacturing and
high value services as the only real option going forward, being fully aware that won't sustain the living standards we've had in recent times but a modest fall beats a crash, right?
What Trump's doing is making that reality somewhat more apparent than it would otherwise be but it was always going to occur. For Australia, Trump has perhaps done the equivalent of announcing the fire using a megaphone before the alarm sounded thus giving more time to evacuate the theatre. He didn't light the fire however, he didn't cause the situation, he just noticed the smoke.
The smart thing for Australia at this point is to take advantage of the opportunity. Use it as the trigger to restructure.
It goes without saying quite a bit of capital's going to be written off at some point. That's inevitable following misallocation.