The upcoming second presidency of Donald Trump is expected to bring about significant changes in key policy areas that will have a global impact. According to a new briefing by GlobalData titled “US Elections 2024 – Executive Briefing (Third Edition): Trump 2.0 Policy Impacts,” five main areas are highlighted as central pillars of Trump’s new administration.
These areas include a potential ‘trade war’ with increased tariffs on imports into the US, a ‘tech war’ stemming from the US-China rivalry, immigration control, tax cuts, and a shift in energy and climate-related policies. The report notes that the motives behind Trump’s policies are complex and often contradictory, leading to a high level of uncertainty.
The report suggests that Trump’s policies could result in economic challenges such as inflationary pressure on demand and weak investment due to tariff and immigration policies. However, Trump is expected to push forward with his agenda regardless of the potential economic consequences. The report also highlights that the US equity market could be influenced by some of Trump’s other key policies.
Of particular concern are the impacts of Trump’s trade and tech wars, which are deemed to have the most significant economic effects and could escalate geopolitical tensions. The report outlines two possible outcomes: increased global fragmentation due to confrontations with allies and adversaries, or the potential for new deals to be struck. Key indicators to watch include the handling of AI chip exports, Russian sanctions, and the TikTok ban.
Specifically focusing on protectionism, the report warns of negative economic impacts worldwide due to tariffs imposed on China and other US trading partners. The uncertainty arising from conflicting motives, such as reindustrializing America and pressuring other countries, adds to the risks.
In the realm of tech warfare, Trump is expected to intensify efforts to lead in key technology areas like artificial intelligence, biotech, chips, quantum computing, and space technologies. This competition could further fracture the global economy but may also bring about positive economic effects.
Overall, Trump’s policies are set to have far-reaching implications for businesses across various sectors worldwide. The uncertainty surrounding his motives and the potential for economic challenges make it crucial for businesses to closely monitor developments in trade, tech, and other policy areas under the new administration.
