Former President Donald Trump’s decisive victory in his bid to win a second term creates both uncertainty and opportunity for US trade policy, according to analysts and experts. Speculation is rampant on the outcomes for Tariffs, FTAs, Climate Policy and The WTO along with fresh scrutiny of AML/CFT regulation and Nuclear proliferation.
Mr. Trump campaigned for a second term on promises to return to his policy of unilateral tariffs, which he sees as a way to raise revenues for the tax cuts he hopes to enact.
Over the course of his campaign, Mr. Trump variously called for across-the-board tariffs on all imports ranging from 10 percent to 20 percent.
He also singled out China – the target for billions in tariffs in the first Trump Administration – for tariffs as high as 60 percent.
Mr. Trump also has said he wants to make sure that China does not have access to US high technology products and has called for tougher restrictions on Chinese investment in the United States.
In the final days of the campaign, Mr. Trump turned his guns on Mexico, threatening to impose 25 percent tariffs on all imports from Mexico if the Mexican government does not crack down on illegal immigration. He also cited the growing presence of Chinese manufacturers in Mexico in order to take advantage of the US-Mexico-Canada Agreement and avoid existing Section 301 tariffs on Chinese products.
It is unclear to what extent Mr. Trump will follow through on his campaign tariff threats, analysts said. In his first term, Mr. Trump did impose massive tariffs on Chinese products – that have been largely retained by the Biden Administration, and used Presidential authority under Section 232 to impose tariffs on imported steel, aluminum and other products on national security grounds.
But as President, Mr. Trump also used the threat of tariffs to pressure countries to bend to his will on particular issues, including Mexico on immigration.
During President Trump’s second term, the USMCA will come up for review, which could present an opportunity for the President to threaten to withdraw from the deal in order to gain concessions from both countries on outstanding trade issues, like Mexico’s ban on US biotech corn and Canada’s restrictions on US dairy products.
On the other side of the coin, free trade advocates see an opportunity for the negotiation of new bilateral free trade agreements in the second Trump Administration. While President Trump used his first day in office to withdraw the United States from the multilateral TransPacific Partnership, his Administration successfully renegotiated the old North American Free Trade Agreement into the USMCA and launched bilateral deals with the United Kingdom and Kenya.
The Biden Administration has opted to reject the traditional comprehensive FTA model, instead preferring to focus on partnership agreements that focus on a limited number of sectors and issues.
But many in the US business and agriculture communities would like to see a return to FTAs, with their focus on market access.
It remains unclear whether the second Trump Administration will be interested in continuing the multilateral Americas Partnership for Economic Prosperity, which is in the early stages and has a limited trade component or the more-established Indo-Pacific Economic Partnership. The IPEP was supposed to include a pillar on trade, but the member countries were unable to reach agreement on the trade component, largely because of a sudden US change of position on digital trade. Although the trade pillar technically still is open, the Biden Administration has made no efforts to jumpstart the stalled talks.
Donald Trump’s win will seriously damage global climate momentum and cast a shadow over COP29 in Azerbaijan on November 11. The incoming Trump administration is expected to walk back U.S. climate commitments and shelve bilateral climate talks with Beijing, writes By Li Shuo, Director, China Climate Hub, and Senior Fellow, Center for China Analysis at the Asia Society
U.S.-China Climate Cooperation Timeline highlights milestones in bilateral climate relations and provides insights into efforts to shape global climate action.
Bill Reinsch, of the Center for Strategic & International Studies writes with Thibault Denamiel that "a second Trump administration would likely upend current talks around the Global Arrangement on Sustainable Steel and Aluminum (GASSA). Moreover, both presidential and legislative elections will affect the conversation around a U.S. carbon border tax and its potential effects on transatlantic trade."
"From a Trump perspective, a carbon price on imports would present another way to hinder foreign competitors’ access to the U.S. market, with the intention of boosting domestic manufacturing’s competitiveness in a critical industry, but he will have no interest in imposing a domestic carbon emissions tax."
WTO participation will be impacted. They note "There are two options that a second Trump administration would likely explore regarding the WTO. The first one is benign neglect: ignoring the organization’s rulings without otherwise hindering its functions. In this scenario, the administration might largely ignore the WTO’s rules without actively obstructing its operations, leading to a continued weakening of its influence on U.S. trade policy but maintaining its importance for the other 165 member countries. Alternatively, a more disruptive scenario would involve the Trump administration actively undermining the WTO, potentially threatening its budget and leadership decisions, which would put the organization’s survival at risk.
Jodi Vittori writes in Foreign Policy "Trump's Backers Fling Open Doors to Money Launderers" Trump’s Agenda47 policy manifesto promises to “cut off the cartels’ access to the global financial system” and “get full cooperation of neighboring governments to dismantle the cartels, or else fully expose the bribes and corruption that protect these criminal networks.”
Jeongmin Kim of NK News reports conservative politicians are calling for South Korea to reconsider its stance on not developing nuclear weapons, arguing Seoul can no longer depend on Washington to defend against North Korean threats.
The ROK has been a state party to the Treaty on the Non-Proliferation of Nuclear Weapons (NPT) since 1975. The ROK has also adopted a policy of non-proliferation and maintaining a nuclear-free Korean Peninsula. On Septeber 6, 2024
The United States and the ROK conducted the first U.S.-ROK Nuclear Consultative Group (NCG) simulation, an interagency table-top simulation, Sept. 5-6, in Washington, D.C. ROK and U.S. national security, defense, military, diplomatic, and intelligence officials participated in the simulation "The United States reaffirmed that its extended deterrence commitment to the ROK is ironclad," according to a US DoD Readout at the time..
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