Donald Trump Puts Tariffs on Islands Inhabited Only by Penguins

President Donald Trump has announced new tariffs on a collection of remote islands—despite the fact that their only residents are penguins.

Why It Matters

The tariffs are part of a new plan announced by Trump yesterday on what he dubbed "Liberation Day." The plan included a universal 10 percent tariff on all imports from countries and higher tariffs on dozens of others.

The administration expects the new rates to remain in place until the U.S. narrows a $1.2 trillion trade imbalance recorded last year. But the extensive list of tariffs also threatens to upend the U.S. economy, as many—but not all—economists say they amount to taxes on American companies that will be passed down to consumers.

What To Know

Trump has announced tariffs on the uninhabited volcanic Heard and McDonald Islands, a remote territory inhabited only by penguins, seals, and seabirds.

The islands were included because they are Australian territory, Axios reported, citing a White House official. An informational guide to the islands on an Australian government website describes Heard and McDonald Islands as "one of the wildest and remotest places on Earth."

The islands are accessible only via a two-week boat voyage from Perth on Australia's west coast, per the Australian Antarctic Program. And, according to U.K. newspaper The Guardian, they have not been visited by a human in nearly 10 years.

The White House says that the islands currently impose a 10 percent "Tariff to the USA," which includes "currency manipulation and trade barriers." In retaliation, the United States has implemented "discounted reciprocal tariffs" at the same rate.

The decision prompted a reaction from Australian Prime Minister Anthony Albanese, who said: "Nowhere on Earth is safe."

World Bank data shows that, in 2022, the U.S. imported $1.4 million worth of goods from Heard Island and McDonald Islands—mostly classified as "machinery and electrical" products, despite the fact that the island has no buildings or people. However, it does have a fishery. It is unclear what the imported products were. In the previous five years, imports ranged from $15,000 to $325,000 annually.

In addition to Heard and McDonald Islands, other Australian "external territories" included in the tariff list were the Cocos (Keeling) Islands, Christmas Island, and Norfolk Island.

Norfolk Island, home to 2,188 residents, faced a 29 percent tariff—19 percentage points higher than mainland Australia.

In 2023, Norfolk Island exported $655,000 worth of goods to the U.S., with its main export being $413,000 worth of leather footwear, according to Observatory of Economic Complexity data.

But George Plant, the administrator of Norfolk Island, disputed the data, telling The Guardian: "There are no known exports from Norfolk Island to the United States and no tariffs or known nontariff trade barriers on goods coming to Norfolk Island."

As Trump announced new tariffs on Wednesday, he blamed previous presidents for allowing other countries to "take advantage" of the American worker and economy. He said Americans "subsidize a lot of countries and keep them going and keep them in business" and added that his plan would be "finally putting America first."

"Trade deficits are no longer merely an economic problem. They are a national emergency," Trump said.

He has claimed that the tariffs will raise $6 trillion over a 10-year period, returning money to the U.S. and the pockets of taxpayers.

But some Republicans have warned that short-term pain may be an inevitable part of the process.

After-hours trading for U.S. stocks saw the Dow Jones, S&P 500 and Nasdaq all drop following Trump's announcement, even though the president scheduled his announcement for 4 p.m. ET seemingly to avoid the potential impact of his announcement.

What People Are Saying

Australian Prime Minister Anthony Albanese said: "Norfolk Island has got a 29 percent tariff. I'm not quite sure that Norfolk Island, with respect to it, is a trade competitor with the giant economy of the United States, but that just shows and exemplifies the fact that nowhere on Earth is safe from this."

In a post on X, he added: "Our Government will always stand up for Australia. These are uncertain times—but all Australians can be certain of this: we will always stand up for Australian jobs, Australian industry, Australian consumers and Australian values. These tariffs are not unexpected, but they are unwarranted. Many other countries will be hit harder by today's decision than Australia—and no nation is better prepared than Australia."

Donald Trump said: "Taxpayers have been ripped off for more than 50 years. But it is not going to happen anymore."

What Happens Next

A 25 percent tariff on "all foreign-made automobiles" will take effect on April 3. The 10 percent "baseline" tariffs will take effect on April 5 and the reciprocal tariffs will kick in on April 9.