How Trump 2.0 will affect the US Import-Export Trade with the global market: US ELECTION 2024

Following Grover Cleveland's historic achievement 131 years ago in 1893, Donald Trump is on track to become just the second US President to secure a non-consecutive second term. Because of the extreme polarization in the US, Trump's strategy continues to be unpredictable and disruptive. 

It is anticipated that his suggested initiatives will have significant effects both domestically and internationally. 

The intrigue isn’t just about policies but also about the overarching impact on the U.S. import-export trade with the global market. 

If Trump were to reignite his leadership, what would that mean for trade relations with various regions, including China, the EU, Canada, and Latin America? 

Let us explore more about the second presidential term of Donald Trump after the US Election 2024 victory.

Trump's Trade Tactics: A Look at Trade Wars and Protectionist Measures Between 2017-2021

Trade served as the compass for President Trump's first term. Even after he left the White House, many of the reforms he and his team made, mostly using trade as a weapon in US foreign and strategic policies, remain in place and are now "hardwired" in Washington policymaking on a bicameral, bipartisan, and long-term basis. This post is the first in a planned series to analyze Trump's trade policies.

When evaluating the dramatic change in US approaches to trade and economic policymaking that began under Trump and mainly persisted under Biden, there are a few things to remember. These include directing the Executive Branch and the White House's trade strategy:

1. Renewed application of unilateral trade tools.
2. Trade policy reformulation to accommodate an economic conflict.
3. Building connections with allies and friends in the economy.
4. Conflict between national security and commerce objectives.
5. Reduction in multilateral policymaking and international trading system.

• Between 2017 and 2021, Trump launched trade wars with China and the European Union and imposed import taxes on goods coming from other nations like Canada.
• This began in 2018 as his administration slapped tariffs of 25% on steel imports and 10% on aluminum imports from some countries.
• Later after obtaining exemptions, it slapped multiple rounds of punitive duties on Chinese products such as 25% on $50 billion worth of imports, and an additional 10% on $200 billion worth of goods, before holding trade talks.
• Other protectionist measures included duties on solar panels and washing machines.
• As Trump seeks a second term, he's going to even further include a blanket tariff of 10-20% tax on all imports and a much higher duty of 60% tax on Chinese products.
• On his final day of campaigning, Trump said he would use tariffs as a tool to pressure Mexico with a 25-100% tax on Mexican goods unless it closes off the border, to curve the flow of immigrants into the US.

Trump's Second Term: A Look at the Impact on Trade, Climate Change, Immigration, and Taxes in the US

The U.S. trade policy, climate change, the war in Ukraine, electric vehicles, American taxation, and illegal immigration would all be significantly impacted if Donald Trump were elected president. Here is a list of the initiatives Trump has stated he would work toward in his second presidential term in office, even though some of them would need congressional approval:

1. LARGER TARIFFS

• In an attempt to close the trade deficit, Trump has suggested imposing a 10% or higher tariff on all items imported into the United States. However, detractors claim that it would result in unstable global economies and higher costs for American consumers.
• Additionally, he has stated that he ought to have the power to impose harsher duties on nations that have imposed tariffs on American products. He has stated that he is particularly committed to preventing the importation of automobiles from Mexico and has threatened to put a 200% tariff on certain imported vehicles.
• However, he has also implied that friends like the European Union might be subject to increased tariffs on their products.
• Trump has specifically targeted China. He suggests phasing out Chinese imports of steel, electronics, and medications over four years. He wants to make it illegal for Chinese businesses to own infrastructure and real estate in the tech and energy industries in the United States.

2. LARGE DEPORTATIONS FOR ILLEGAL IMMIGRANTS

• Trump has promised to move forward with broad new limits and to bring back his first-term measures that targeted illegal border crossings.
• He has promised to start the largest deportation campaign in American history and restrict access to asylum at the U.S.-Mexico border, which is sure to spark legal challenges and resistance from congressional Democrats.

3. MINERAL FUELS AND ENERGY SECTOR IN FOCUS

• Trump has promised to promote new natural gas pipelines and expedite the permission process for drilling on federal land to boost the United States production of fossil fuels. He has declared his intention to reinstate oil drilling in Alaska's Arctic National Wildlife Refuge.
• It remains to be seen if the oil industry follows through and increases production during a period of relatively low oil and gas prices.
• He has stated that he would support more nuclear energy production and that he will once more remove the United States from the Paris Climate Accords, a framework for lowering greenhouse gas emissions worldwide.
• In addition, he would reverse rules that were put in place by Democratic President Joe Biden to reduce vehicular emissions, like as the mandates for electric vehicles.
• He has maintained that for the United States to compete in the development of artificial intelligence systems, which use a lot of electricity, it must be able to increase energy output.

4. RELIEF FROM TAXES

• Trump has pledged to reduce government regulations that he claims impede the development of jobs, in addition to his trade and energy objectives. 
• His economic team has considered implementing more tax cuts for individuals and corporations beyond those implemented during his first term, and he has committed to maintaining the comprehensive 2017 tax cut that he signed while in office.
• Trump has promised to lower the corporate tax rate for businesses that manufacture their goods in the United States from 21% to 15%.
• To support waiters and other service workers, he stated that he would pursue legislation to eliminate the taxes on tips and overtime wages. He has promised not to reduce Social Security benefits or tax them.

Current US Trade Statistics and Import-Export Data 2024

Accoding to latest US Import  Data and US Export Data reports

US Exports Under Trump Leadership

During his first term, Trump's administration focused on boosting U.S. exports through protectionist policies and renegotiated trade agreements. During 2017-2021, the total US exports under Trump's leadership totaled $8.01 trillion in 4 years. Under Trump 2.0, We can expect a continuation of the "America First" agenda, aiming to increase exports in key sectors such as agriculture, manufacturing, and energy. The emphasis could be placed on supporting American industries by lowering tariffs on exports and creating favorable trade conditions that encourage foreign nations to buy U.S. goods.

Trump’s Trade Plan for His Second Term

Central to Trump's trade plan for a potential second term would likely be aggressive trade negotiations aimed at reducing trade deficits. Trump’s administration previously underscored the importance of striving for trade balance, and we can expect similar rhetoric. The U.S. trade deficit, which peaked during his first term, might be addressed through measures such as tariffs on imports from countries with which the U.S. has significant deficits, notably China.

US-China Trade War and Trade Sanctions 

The US-China trade war marked a defining aspect of Trump’s economic policy, where tariffs were imposed on a multitude of Chinese goods in an attempt to foster local production and decrease imports. If Trump regains power, it’s plausible that tensions with China will reignite, potentially leading to an escalation of tariffs and a structured attempt to decouple dependencies on Chinese manufacturing. This could disrupt supply chains further but may also result in an impetus for other nations, especially in Southeast Asia, to fill the gap, thus reshaping trade dynamics in the region.

According to US China Trade data, The average US tariff on Chinese goods in January 2018 was 3.1%. After a bilateral Phase One agreement with China, the average increased to 21% in under two years before dipping a little to 19.3% in March 2020. China increased its initial 8% tariff on U.S. imports to 21.8% throughout that time frame, before stabilizing at 21.3%. Under Biden, tariffs were once again used as a "legitimized" trade policy instrument.

Impact on EU Trade

Trump’s previous administration fostered a rollercoaster relationship with the European Union, leading to the imposition of tariffs on European goods, particularly in the steel and aluminum sectors. Under Trump 2.0, the focus would likely shift toward negotiating fair trade agreements that Sarah Mercado's U.S. interests. This could either aggravate existing tensions or offer a fresh start with renewed discussions. The outcome would be critical as the EU remains one of the U.S.'s largest trading partners. 

            As per our Europe Import Export Data Reports with USA

• Among the EU countries, the Netherlands is the biggest export partner of the US with exports worth $82.18 billion from the US in 2023. 
• Mineral fuels and oil are the biggest US exports to the EU worth $92.52 billion in 2023. 
• Among the EU nations, Germany is the biggest import partner of the US with imports worth $163.08 billion to the US in 2023. 
• Pharmaceuticals are the biggest US imports from the EU worth $116.05 billion in 2023. 

Let’s take a look at the import-export trade between the EU and the US during the first tenure of Trump as the US President between 2017 and 2021:

Impact on Asian Countries

Asian countries could feel significant repercussions if a Trump 2.0 administration reinstates stringent trade policies. Nations like Vietnam and India might become increasingly attractive alternatives for U.S. companies looking to avoid tariffs. 

Ultimately leading to an influx of investments in these countries. Conversely, Japan and South Korea may have to tread carefully, politically aligning their trade strategies with U.S. interests to maintain favorable relationships while navigating their trade openings to China. 

          Based on our reports Asia Import Export Trade Data with USA 

• Among the Asian countries, China is the biggest export partner of the US with exports worth $147.80 billion from the US in 2023. 
• Mineral fuels and oil are the biggest US exports to Asia worth $86.59 billion in 2023. 
• Among the Asian nations, China is the biggest import partner of the US with imports worth $448.03 billion to the US in 2023. 
• Electrical machinery and equipment are the biggest US imports from Asia worth $316.67 billion in 2023. 

Let’s take a look at the import-export trade between Asia and the US during the first tenure of Trump as the US President between 2017 and 2021:

Impact on Trade with Latin America

The potential for a Trump 2.0 administration could reignite discussions around trade partnerships in Latin America, urging countries like Mexico to maintain favorable trade practices. Increased scrutiny of immigration policies may also influence trade relations, embedding economic cooperation as a pathway for improved bilateral ties in the region. 

As reported by Our South-America Trade Data with USA

• Among the Latin American countries, As per our Brazil export data indicates Brazil is the biggest export partner of the US with exports worth $44.80 billion from the US in 2023. 
• Mineral fuels and oil are the biggest US exports to Latin America worth $106.97 billion in 2023. 
• Among the Latin American nations, Brazil is the biggest import partner of the US with imports worth $40.99 billion to the US in 2023. 
• Vehicles are the biggest US imports from Latin America worth $131.55 billion in 2023. 

Let’s take a look at the import-export trade between Latin America and the US during the first tenure of Trump as the US President between 2017 and 2021:

Impact on Trade Relations with Canada and NAFTA

Trump’s first term saw a focus on renegotiating trade deals like NAFTA, which transformed into the United States-Mexico-Canada Agreement (USMCA). With Canada being one of the U.S.'s top trading partners, Trump's second term could see either a reestablishment of NAFTA-like agreements or a push for more stringent controls around imports, particularly in dairy and softwood lumber. The state of these relations will be pivotal as they directly affect supply chains and cross-border trade, with potential backlash from Canadian industries if protections are reinforced.

Final Verdict and Conclusion

To conclude, after the results of the US Election 2024, the prospect of Trump’s return to the presidency in 2024 carries significant implications for the US import-export trade on a global scale. As Trump 2.0 approaches, stakeholders must navigate the uncertainties surrounding trade policies and their ramifications across key international markets. Whether through renegotiated trade agreements or increased tariffs, the outcome will undoubtedly reshape America's economic landscape and its position in the global trading community. As we inch closer to Election Day, the world watches closely, poised for the direction of U.S. trade under a potential second Trump administration.

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