US Defends Tariffs on Remote Island Populated by Penguins and Seals

The BBC reports that US Commerce Secretary Howard Lutnick defended the country’s decision to impose tariffs on the uninhabited Heard and McDonald Islands, home to only penguins and seals. The tariffs, aimed at closing “ridiculous loopholes,” would prevent other nations from shipping goods through the islands to the US, Lutnick told CBS.

Australia expressed surprise at the move, with Trade Minister Don Farrell calling the decision a “mistake” and a result of a “rushed process.” In response, Lutnick argued that leaving any areas off the tariff list would allow countries to bypass US regulations. “The President knows that, he’s tired of it, and he’s going to fix that,” he said.

The tariffs come amid a broader defense of President Trump’s new trade policies after US stock markets suffered a major drop. Transshipment—shipping goods through one port to another—is common in global trade but can enable data manipulation, according to Pew Charitable Trusts. The NGO estimates that millions of dollars worth of tuna and similar goods are illegally moved in this manner annually in the Pacific.

While export data from the islands shows only minimal trade with the US in recent years, 2022 saw a spike with $1.4 million worth of “machinery and electrical” products imported from the territory. Also included in the tariff list was the British Indian Ocean Territory, which exported $414,350 worth of goods to the US in 2022.