How to resolve AdBlock issue? Jane Hardy warns of many twists in the Strait of Hormuz saga
By Leon Gettler, Talking Business >>
WITH ALL THE CHANGES in geopolitics, the world’s attention is now heavily drawn to two areas: the Strait of Hormuz and tariffs.
Jane Hardy, a former Australian diplomat and foreign policy expert, knows all about this.
Now a fellow of the Australian Strategic Policy Institute, Ms Hardy has more than three decades of experience in international affairs, diplomacy and strategic policy. She has held senior ambassadorial and diplomatic postings spanning Europe, the United States, Asia and West Africa. 
She has also provided advice on some of the most complex geopolitical and security issues shaping the global landscape.
Many bends in the Strait of Hormuz
Ms Hardy said while “whatever will come” out of the on-again-off-again agreement between the US and Iran, restoring the world’s oil supplies will take significant time.
“There’ll be a freeing up of oil coming through the Strait of Hormuz but that may take (more) time to impact,” Ms Hardy told Talking Business.
“It will take some time for us to see benefits from, hopefully, the cessation of the war between the US and Iran and the impact on the Strait of Hormuz.
“But from what I see of the deal, Iran holds some very significant cards and the key being its effective control of the Strait which it can impose at a flick of the switch. So nothing is over yet.”
Ms Hardy said that region would see a lot of vulnerability – and markets don’t like vulnerability.
She said it would take years to fix the liquefied natural gas (LNG) infrastructure in the region with the bombings causing enormous damage.
“That will take a long time to rebuild according to the experts,” she said.
Ms Hardy, who also holds an economics degree, takes the traditional view of tariffs that they are a tax on the importing country, not the exporter. This is why US inflation is up and US President Donald Trump’s difficult political situation has reflected that problem.
Looking beyond tariff threats
However Ms Hardy said the Trump Tariff Tracker at the US Studies Centre at Sydney University reveals that despite the threats, only a few of the tariffs had been effectively imposed.
That means the rest of the world, apart from the developing economies, has not suffered as much from the tariffs, she said.
“The markets have been jumping around in response to the tariff situation but they have settled into a routine where they have already been factored in this chaos,” Ms Hardy said.
She said there had been a recent proposal from the US Administration for a 12.5% tariff on Australian products citing “forced labour concerns” which was hurriedly imposed last week, replacing the former 10% tariff.
“This is very creative work by the US Trade representative’s office,” Ms Hardy said, with irony.
“I can imagine how awful it is to be working there as an official these days. I used to talk to them a lot when I was US branch head, with all the regular talks we had with the US on our own FTA (free trade agreement).”
Ms Hardy said she wasn’t sure what would happen in the longer term with that ‘forced labour’ tariff.
“Our trade officers and their expertise and experience in dealing with the bully pulpit that the US represents – and has always represented – on issues such as reciprocal deals or problems that the US Trade Office will raise in order to put pressure on us,” she said.
“Furthermore, we have a trade imbalance with the US in that we have a great trade deficit with the US because we buy so much, particularly in advanced technology and military goods. 
“We are pushing back hard on the tariff situation.”
Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness
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