December 5, 2016
Another month and I’m picking my jaw off the floor again. This time, the result of the US presidential elections. All polls had pointed to the first ever female POTUS but instead, it was Donald Trump – a man who had at times been given a laughably small chance of winning – who achieved the 270 electoral votes needed to become the 45th President of the United States.
Whether you think Donald Trump is a dangerous misogynist and racist or an anti-establishment hero, the US population has him as their commander-in-chief for the next four years – and, given the country’s position of power in the world, the rest of us are stuck with him, too.
It is, of course, still early days for the President-elect but this hasn’t stopped a tsunami of questions being asked about what kind of president Donald Trump will be.
His campaign was hugely controversial, featuring claims that he would build a wall along the US-Mexico border and that climate change was a Chinese hoax. However, since winning the election, some of most eye-watering statements have already been watered down – probably as the realisation of what is achievable as US President sets in.
There is also a consensus that, despite the controversy, Donald Trump will be a pro-business leader, with promised cuts to corporate tax for US businesses.
More worryingly for international business, though, is that there has also been much protectionist rhetoric espoused by Trump during the election campaign.
Julie Underwood, international trade director for the North East England Chamber of Commerce says: “There’s still an awful lot of questions to be answered about President Trump’s international engagement policies.
“Had Hilary Clinton won the election, then I think it is probable that a lot of policies in terms of international relationships and trade would have stayed the same. This would have created more consistency for business. But we don’t know what President Trump will do.”
Stan Higgins, CEO of NEPIC, adds: “[Trump] believes that a lot of the negotiated trade agreements have resulted in the loss of jobs in America. I’m not sure that’s the case. I think industry in the US has suffered, along with all global economies, because there is more automation, particularly in manufacturing, which has led to fewer jobs.”
John Dickerman, head of the Washington office at CBI, maintains that the UK is still a hugely important market for the US – and vice versa.
“The UK is the number one investor in the US, by quite a large margin,” he says. “£400 billion has been invested in the US by UK firms and it has created one million jobs Stateside. And this has been reciprocated with US firms creating one million jobs in the UK.
“The Trump rhetoric on trade has been very harsh,” John continues, “but having said that, what we’ve been able to glean from the campaign is that he does value the relationship with the UK – not only because we share a common language, a common ecosystem and common values, but the investment into both of our countries have been hugely significant for a long time.”
John also talks about the indication from the Trump team that it would prefer arranging trade agreements with individual countries to multi-state ones. This may work in the UK’s favour after Brexit, as who could forget President Obama’s warning to the UK that it would languish ‘at the back of the queue’ if it chose to leave the EU.
But there is still concern about the Trump presidency. His lack of political experience and ever-changing policy commitments, not to mention his unpredictable nature, creates uncertainty – the bane of businesses around the world.
“Industry needs certainty, even if it’s negative,” says Stan Higgins. “Running a business is all about managing risk and you want to be able to make a forecast of what’s going to happen and prepare for this in the business plan.”
Stan also has a stark warning about the President-elect’s stance on climate change.
“If the US doesn’t commit to global strategies to reduce carbon emissions, there will not only be a massive impact on the climate but on global industry, too,” says Stan. “There is a great cost to cutting carbon emissions: changing raw materials and capturing carbon, etc., is done at a huge expense. If US companies don’t have to spend on these technologies, they will become more competitive and work will go to them.
“Climate change has to be tackled by everyone as this makes it a level playing field for everyone.”
From January 2017, President Trump will enter the White House with a mammoth task ahead of him. He must create a solid political strategy that will reward his supporters and appease his doubters. How – and if – he manages to do this remains to be seen.
If global business was hoping for more predictability going into 2017, it hasn’t got it Stateside, thanks to events on November 8.