IRIA News

4 minute read

Australia’s center-left Labor Party has secured a decisive victory in the 2025 federal election, returning Prime Minister Anthony Albanese to office in a historic second term. Albanese has become the first ever Australian Prime Minister to secure two back-to-back terms in office.

Overall, elections were marked by mounting concerns over global economic instability, particularly the impact of U.S. President Donald Trump’s sweeping new tariffs, unsettling markets and voters alike.

Labor supporters erupted in celebration in Sydney as Albanese claimed victory Saturday night. “We will be a disciplined, orderly government in our second term, just like we have been in our first,” Albanese said while visiting a coffee shop in his electorate. “The Australian people voted for unity rather than division.”

The Australian Electoral Commission (AEC) projected that Labor would win 80 of 150 seats in the House of Representatives, while the Australian Broadcasting Corporation (ABC) estimated 85 seats, enough for a clear majority. The conservative Liberal-National coalition was projected to win 41, with nine independents and 15 seats too close to call.

This year’s campaign was initially dominated by cost-of-living issues and inflation, with polls showing Labor trailing until March. The tide turned after the conservative coalition proposed deep federal job cuts and mandatory five-day office returns, moves widely criticized as tone-deaf, particularly among women voters and younger professionals.

The April 2 announcement by U.S. President Trump on sweeping new tariffs further rattled global markets and Australian voters alike, stirring fears over pension fund stability and economic fallout.

Elections amid anxiety over Trump tariffs

Voters heading to the polls faced growing uncertainty after Trump’s tariff announcement sent global markets into deep slumps. The proposed tariffs, targeting key sectors like steel, electronics, and green energy components, had immediate repercussions in Australia, triggering pension fund fears and raising questions about the nation’s trade exposure.

“The immediate focus is on global economic uncertainty, U.S. and China, and what it means for us,” said Australia’s Treasurer Jim Chalmers. “What’s happening, particularly between the U.S. and China, does cast a dark shadow over the global economy. We need to have the ability, and we will have the ability, to manage that uncertainty.”

The renewed U.S.-China trade tensions revived painful memories of earlier economic disruptions and fed public demand for economic security, a narrative Labor seized upon in the final weeks of the campaign.

Collapse of Conservatives and Liberals

The once-resurgent opposition faced a crushing defeat, capped by the loss of Liberal leader Peter Dutton’s seat in Queensland’s Dickson. Dutton had surged in polls earlier in the year, but his tough-on-crime, anti-immigration messaging and frequent comparisons to Donald Trump proved costly.

“We didn’t do well enough during this campaign. That much is obvious tonight, and I accept full responsibility for that,” Dutton said following the election results. He conceded personally to the Labor candidate who unseated him and acknowledged the party would need to regroup.

The Liberals’ proposal to slash federal jobs and end flexible work arrangements drew sharp criticism, especially from women and younger voters. This, combined with growing unease about Trump’s influence, proved fatal. As in Canada’s federal election days earlier, where conservatives lost amidst Trump backlash, Australian voters rejected right-wing populism.

International reactions

World leaders swiftly extended congratulations to the winning administration. Secretary of the U.S. Department of State Marco Rubio expressed hopes for deepening ties.

“The U.S. looks forward to deepening its relationship with Australia to advance our common interests and promote freedom and stability in the Indo-Pacific and globally,” Rubio said in a statement.

China also congratulated the upcoming administration, with its Foreign Ministry saying it “stands ready to work with the new Australian government [to] continue advancing a more mature, stable, and productive comprehensive strategic partnership.”

A shift away from Trump-aligned figures

Australia’s election outcome aligns with a broader international trend, where political figures and parties associated with Trump-style politics are increasingly facing domestic backlash and electoral defeats. Similar patterns have emerged in recent elections in the United Kingdom and Canada.

In Australia’s case, the result signals a decisive rejection of Trump-style economic nationalism. Treasurer Jim Chalmers portrayed the election not merely as a domestic verdict, but as a statement on how Australia should navigate its role within an increasingly unstable global economy.