US Administration Information

Update for Australia on the 46th President of the United States, Joe Biden

Highlighted Business Opportunities for Australia

With the new administration came many changes and with a record number of executive actions in the early days, there is a promise for an abundance of developments to come. Biden’s four central objectives of tackling economic downturn, climate change, racial inequity, and COVID-19 call for drastic and swift action. This industry change presents many challenges across America and the world but with it comes new opportunities to flourish. As a key ally and with an abundance of natural resources Australia is in the forefront to accept and again show, as Andrew Liveris so accurately said on AmCham’s ‘the Alliance’, how “we punch above our weight”. Following are a few key Australian business opportunities that have been presented.

COVID-19 Testing
As most pressing in America Biden signed 10 executive orders regarding the handling of the COVID19 pandemic and created a federal testing board to increase testing and remove barriers so all citizens have access to acquire rapid results. This presented a massive hurdle for the US and resulted in Biden ordering 8.5 million tests from Brisbane based company Ellume signing an AU$302 million deal with the US for their rapid at-home tests. Included in this deal Ellume is set to create a manufacturing center set for the Australian spring in the US which is set to produce 19 million per month by the end of 2021.

Vaccine Production and Distribution
President Biden set a goal of vaccinating 100 million people in his first 100 days. To do so he plans on establishing thousands of centers with 100 federally supported vaccination centers across the country by the end of his first month. In his current budget proposal, Biden has allocated US$20 Billion to Vaccination efforts. With the goal of free vaccinations for all citizens, Biden needs a lot more stock to meet his goal. With CSL in Australia producing the AstraZeneca vaccine, one still missing from the US arsenal of vaccines. The company may see an increase in global demand after approval from America which is currently in the testing phase.

Electric Vehicles Components
In Bidens Executive order on ‘Tackling the Climate Crisis at Home and Abroad,’ he proposes many measures on how to combat climate change. Notably, in Section 205 (b)(ii) he calls for all federal vehicles including the postal fleet to be clean and produce zero-emissions. This is aimed to stimulate clean energy industries within the US. A huge hurdle in this plan is the rare earths required to produce high-tech battery-powered items such as electric vehicles. Currently, China is a major source of these materials. However, the associated toxins with the removal of such materials have been anything but clean and ended with many calling for the companies benefiting from the industry to fit the bill. With Australia and the US already in a preliminary joint venture to research and develop cleaner removal of minerals, there is great potential in Australian mines to benefit from the increase in demand. Australia is in line to become the world’s new rare earths powerhouse with the Browns Range Project in Western Australia and mines across the nation.

Biden’s focus on clean energy led to him deeming the long-debated Keystone pipeline was incongruent with the ideals and national interest set forth for the future of America. To exemplify the devotion to climate action the president revoked the permit for the Keystone XL pipeline in the executive order on ‘Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis.’ This prevents the landlocked Canadian oil company from exporting the oil overseas. This may present an opportunity for Australia to streamline our fuel exports. There are acknowledgements that similarly to native title in Australia, the Native American lobbyists in the US also lead to the pressure on the pipeline ban which may help guide our future development as to avoid similar arguments here.

Supply Chain
Although the current administration is much more open to foreign policy collaborations, the requirements and focus on American production has become more stringent. In Biden’s Executive Order on ‘Ensuring the Future Is Made in All of America by All of America’s Workers’ he replaced the percentage requirement for components of an item to be classified as made in America and receive government funding with a stricter value-added ideal ensuring the parts that add the most value are the ones created in America. He also added a requirement for all companies intending to receive a waiver for this requirement to publicly post the job and allow American producers to bid for the production job. This presents worries about Australia’s exports to the US. However, as explained in AmCham’s ‘Live From America Series: US Election Review’, Joe Hockey indicated that Australia’s work as a trusted supplier will continue to exempt us among Canada and the UK from the nationalism of the supply chain in the Biden administration. The US’s importation of raw materials from Australia will still be necessary. The President has also vowed to help allied countries to build up their internal supply chains after the pandemic greatly demonstrated the volatility of reliance in such matters helping us as we break away from China.

Executive Orders & Notable Actions

President Biden has passed more Executive Orders in his first fifteen days than any of his predecessors. With a much more international focus than the previous mantra of “America First” many impact international relations with Australia. Here are some of the noteworthy developments thus far and what it means for the US-Australia alliance.

As one of the most pressing issues in front of this administration with over 26 million cases in the US, Biden enacted several Executive Orders regarding COVID19 protections within the very first day in office. The US’ recovery is vital to Australia’s economy.

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Manufacturing and Trade
Hoping to further American growth and retain future command on the manufacturing industry, Biden has expanded the ‘Made in America’ campaign by increasing spending for domestic-made products while simultaneously introducing more stringent requirements for the value of parts built in America. This presents worries about Australia’s exports to the US. However, as explained in AmCham’s ‘Live From America Series: US Election Review’, Joe Hockey demonstrated that Australia being a trusted supplier will continue to exempt us among Canada and the UK from the nationalism of the supply chain in the Biden administration. The President has also vowed to help allied countries to build up their internal supply chains after the pandemic greatly demonstrated the volatility of reliance in such matters.

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Climate Science
With the US set to emphasize Climate Science declaring it a crisis and setting hard goals for emission reduction meeting zero by 2050, some think it may be a sore spot between Australian and US relations. Michael Fullilove, the executive director of The Lowy Institute, says climate change could be a sticking point in the relationship between the Morrison government and the Biden administration. After rejoining the Paris agreement and creating the Special Envoy on Climate Change John Kerry said they are also going to push their friends because everyone needs to “up their game”. By passing protections and a temporary memorandum on oil and gas activity in the Arctic National Wildlife Refuge and revoking the Keystone Pipeline permit the US is open to rethinking the consumption of resources and hoping to work with Australia and China to accomplish the new goals. President Biden prefacing the Order by stating “Domestic action must go hand in hand with United States international leadership, aimed at significantly enhancing global action. Together, we must listen to science and meet the moment.”

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As predicted by Joe Hockey in AmCham’s ‘Live From America Series: US Election Review’ The Biden-Harris administration is a step towards healing the deep historical tensions that have so prominently divided the US. With the first multiracial, and first woman, Vice-President as well as the diverse cabinet they have brought forth also came a strong line of policy and political measures. Denouncing and condemning racial, gender and sexual orientation discrimination. They are set to lead the US and consequently the world in a very different tone than the previous administration. As one of the most diverse nations this era removed bans on transgender military personal, plans to combat racism and xenophobia associated with the pandemic and lower incarceration rates which have disproportionately affected minority groups. With an ode to the late Ruth Bader Ginsburg, this administration is taking a hard stance against discrimination on the basis of gender identity or sexual orientation. ”

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President Biden’s immigration policy is centered around creating a “fair and humane immigration system”. The President has already begun undoing many of President Trump’s policies, including stopping construction on the Southern Border Wall, restoring the DACA program, stopping the separation of children from their families at the border, and ending the Travel Ban on people from six Muslim majority nations. The President has even gone so far as being critical of his own role in the Obama-Biden Administration when it came to the removal of people from America. This points to Biden showing a more compassionate approach to immigration, a stark contrast to President Trump’s “zero tolerance” approach. The President has also appointed Cuban immigrant Alejandro Mayorkas as US Homeland Security Chief, signaling a more immigrant focused and friendly policy agenda.

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Biden intends to provide more relief to the US than the previous administration. Already he has introduced federal worker protections outlining a path to a $15 minimum wage and paused student loan repayment keeping interest rates for such zero. The low-interest rates all around are expected to stay in an attempt to combat the effects of the pandemic furthered by an order for all executive agencies to consider actions to address the economic crisis. Biden has proposed a $1.9 Trillion stimulus plan, but it is struggling to make it through Congress intact. From Australian shores, Josh Frydenbeg argues the importance of the US to join in regular talks to share notes for economic recovery.

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President Biden’s healthcare policies aim to protect and build on the Affordable Care Act (More colloquially known as Obamacare) that was signed into law during the Obama-Biden administration. The President has spoken of his desire to revive the ACA following President Trump’s attacks and attempts to end the program. The President has already signed executive orders to this effect: Firstly, ordering the reopening of enrollments in the Health Insurance Marketplace. As a result, the Department of Health and Human Services will reopen enrollments from February 15 to May 15, providing Americans with the ability to gain cover during the pandemic. Secondly, the President has ordered all federal agencies to review policies that undermine the Health Insurance Marketplace and ACA as a whole. Thirdly, the President has signed an order directed at protecting women’s health and reproductive rights in America and abroad. In summary, while Biden is not expected to introduce any major healthcare policy of his own, he is expected to build on the ACA and continue a science-based approach to fighting the Covid-19 pandemic. An approach that makes up a policy agenda of its own.

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Bidens White House has added several new agencies to inform him in his daily decisions. Mainly regarding ethical and scientific advisors. With executive orders increasing the impact possible and information available to the branches he plans to work closely to ensure a new type of government policy can be enacted. Following from that he added a requirement to all executive appointees’ onward sign and follow an ethics agreement to not procure personal gain from their service in their position.

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Australia’s Friends in Washington

The President aimed to make his White House look “like America does.” His nominations were composed of 48% women and half were people of color. Among this record-breaking diversity, Australia saw the return of a few familiar faces. With many friends in Washington, a few Cabinet members have already spoken about the countries’ great alliance, and the continued collaboration to come. Here is who made the cut and how they will impact our Region.

Secretary of State Anthony Blinken (Confirmed)
Former US Deputy National Security Advisor and Deputy US Secretary of State Bliknken is very aware of the importance in the Indo Pacific region with his role in strengthening America’s alliances here highlighted by President Biden. His foreign policy on the matter of China seems to reverberate that of Australia’s. He has stated the key to dealing with China is building and strengthening alliances in this region. He stands with multilateral agreements and plans to work with other countries including China on issues such as climate change and health emergencies or preventing the spread of deadly weapons. The Australian Foreign minister Marise Payne and Blinken spoke recently and discussed mutual global foreign policy priorities promoting human rights, rule of law, and regional security as well as tackling shared challenges. Their relationship extends back to the Obama administration giving them a familiar transition for working well together.

Secretary of the Treasury Janet Yellen (Confirmed)
As Former Federal Reserve Chair and former Chief White House economist Janet Yellen is known for detailed research and not making rash decisions, Yellen Has already followed in suit with Biden's climate change policy by “forcefully addressing the threat of climate change” being a top priority. Yellen will be in dealings with the Australian treasurer, Josh Frydenbeg but he was not the first to speak with her. Frydenbeg has recently championed economic talks among the finance ministers from the Five Eyes countries, which also includes the UK, Canada and New Zealand. Frydenberg has argued the once-in-a-century pandemic only increases the importance of regular talks to share notes on economic recovery strategies. She is tasked with repairing the US economic situation after the pandemic and according to Biden there is “no one better suited to deal with these crises.”

Secretary of Defense Department Lloyd Austin (Confirmed)
President Biden’s historic cabinet nomination of African American Llloyd Austin for Defense Secretary is good news for Australia. Austin has already affirmed America’s commitment to the special relationship between Australia and the USA, describing it in a phone call with Australia's Defence Minister Linda Reynolds as an “unbreakable bond”. Austin is determined to make Indo-pacific regional security a priority for America, protecting Australia as an ally.

Indo-Pacific Coordinator for National Security Council Kurt Campbell (Appointed)
Kurt Campbell AO, CNZM is set to be the inaugural Coordinator of the Indo Pacific (Asia Czar), a position created by President Biden to help counter the rise of China in the region. Campbell has a unique connection to Australia in that he was awarded an Order of Australia in 2013 for strengthening Australian American bilateral relations. Campbell will be an important ally for Australia in a region that is becoming increasingly unstable. He recently acted as Chairman and CEO of the Asia Group, a strategy and advisory firm aimed at forwarded the interests of the world’s leading companies in Asia. The Australian columnist Greg Sherian recently referred to Campbell as smart, hawkish, tough, a superb operator, a deep thinker and Australia’s best friend in Washington.

National Security Adviser Jake Sullivan (Appointed)
President Biden’s National Security Adviser Jake Sullivan is likely to be a friend of Australia. In December following increasing trade tensions between Australia and China Sullivan tweeted “The Australian people have made great sacrifices to protect freedom and democracy around the world. As we have for a century, America will stand shoulder to shoulder with our ally Australia and rally fellow democracies to advance our shared security, prosperity, and values.”. Given Sullivan’s proximity to the President, these words of support should come as a reassurance to Australia that the Biden administration will stand by Australia as a regional ally.

USTR Katherine Tai (Confirmed)
Katherine Tai is a former attorney serving as the chief trade counsel for the United States House Committee on Ways and Means. Biden’s choice of Katherine Tai as U.S. trade representative is another clear indication of an unchanging anti-China policy. Biden praised the record of Tai as America’s chief trade enforcer against “unfair trade practices” undertaken by China and that this would be a key priority for the new administration. This will be very helpful to Australia as our own fight with China continues having repeatedly banning Australian exports.

Acting Assistant Secretary of State for ASEAN Sung Kim (Appointed)
Incoming Assistant Secretary of State for East Asian & Pacific affairs Sung Kim enters his role with a deep connection to the Asia Pacific region. In his most recent role, Kim was US ambassador to Indonesia, given the strategic significance of Indonesia to Australia, Kim will be very aware of the economic and geopolitical issues facing the region and is expected to be a friend of Australia. Kim has also served as US ambassador to the Philippines and South Korea. With strong trade links supported by our regional and bilateral free trade agreements, this is an important relationship for Australian business into the economic community.

Georgian Senator Jon Ossoff (Elected)
Senator Jon Ossoff was recently successful in his extremely public Senate runoff election, assisting the democrats in gaining control of the senate. Ossoff has what is perhaps the closest connection of any current US Congressmen or Senator to Australia. Ossoff’s mother was born and raised in Sydney before moving to America at age 23, Ossoff himself once held Australian citizenship (now lapsed). This very close Australian connection in the senate may be helpful for Australian business and negotiation in the long term as at age 33, Ossoff is the youngest person elected to the senate in 40 years.

Secretary-General, Organisation for Economic Cooperation and Development Mathias Cormann (Elected)
Mathias Cormann is Australia’s candidate within the final five in contemplation for Secretary-General of the OECD. The OECD is an international organisation forming policies to cultivate prosperity, equality and opportunity globally. Cormann was formerly Australia’s Minister for Finance and the Senator of Western Australia, both roles concluded in 2020. Having spent half of his life living in Europe and the other half in the Asian-pacific region, Cormann has a rare insight into the political dynamics, economic capabilities and cultures of the areas. This is a great opportunity for Australia to lead an international institution gaining bipartisan support from both Labor and Liberal. However, the Greens have lobbied against his role due to Australia’s inaction on climate change. The decision is due to be made in March of this year with only the candidates from Australia, Switzerland, Denmark, Sweden and Greece remaining from the 37 member countries.