Australia's reelected government says US-China tussle a top priority

By Byron Kaye

SYDNEY (Reuters) -Australia's government will prioritise dealing with the "dark shadow" of the U.S.-China trade war following its resounding reelection victory, Treasurer Jim Chalmers said on Sunday, after a campaign that highlighted concerns over U.S. trade policy and the global economy.

Labor Party leader Anthony Albanese, Australia's first prime minister to win a second consecutive term in two decades, promised in remarks on Sunday that he would run a disciplined and orderly government, stressing that Australians had voted for unity.

The centre-left Labor Party appeared likely to expand its majority in parliament to at least 85 seats from 77, the Australian Broadcasting Corp projected, after most polls had suggested it would struggle to keep its slim hold on the 150-seat lower house. More than two-thirds of votes have been tallied, with counting to resume on Monday.

Echoing an election in Canada less than a week earlier, Australia's conservative opposition leader, Peter Dutton, lost his seat as voters, who initially focused on cost-of-living pressures, grew increasingly concerned over U.S. President Donald Trump's sweeping tariffs and other policies.

"We will be a disciplined, orderly government in our second term, just like we have been in our first," Albanese told reporters while visiting a coffee shop in his Sydney electorate where he said his late mother took him as a child.

"The Australian people voted for unity rather than division," Albanese added in brief public comments.

Polls had shown Labor trailing the opposition conservative coalition for nine months until March, amid widespread angst about the government's handling of inflation.

But the polls flipped when the conservatives unveiled a proposal to slash the federal workforce, which was compared to the Trump administration's moves to cut back government agencies. A proposal to force federal workers back to the office five days a week was also criticised as unfair to women.

Trump's April 2 tariff announcement added to voters' unease as it sent shockwaves through global markets and raised concerns about the impact on their pension funds.

"The immediate focus is on global economic uncertainty, U.S. and China, and what it means for us," Treasurer Jim Chalmers told the Australian Broadcasting Corp.

"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."

Former conservative member of parliament Keith Wolahan, who conceded his seat at the election, told the ABC his party had mis-read the public mood.

"It was clear that our party has an issue in urban Australia, which is where most people live," he said.

"We need to really dig deep and think about who we are and who we fight for and who makes up Australia," Wolahan added.

(Reporting by Byron Kaye; Editing by Edmund Klamann)