Elections Outlook Report - Flipbook - Page 62
Trump Administration Trade Policy Executive Outlook
Tariffs
At the top of President-Elect Trump’s policy agenda is an aggressive
tariff policy aimed at addressing reciprocity for U.S. companies, lowering
the U.S. trade deficit, spurring new domestic manufacturing, increasing
revenue, and addressing national security concerns. He has consistently
emphasized plans to impose tariffs on imported goods, with a particular
focus on goods from China, though specific tariff rates have varied in
his statements. Trump has proposed a 60% tariff for Chinese imports,
including a plan to phase out imports of essential goods from China to
reduce dependency. He has also said that he intends to apply a universal
10% to 20% tariff on the $3 trillion worth of goods imported into the US
from every other country in the world.
Trump and his campaign have provided limited details on how they intend
to implement this plan. Many trade experts believe he could swiftly utilize
existing authority, such as the International Emergency Economic Powers
Act, which grants the president broad authority to regulate economic
transactions upon declaring a national emergency. Others have suggested
that the President could work with Congress to enact legislation
authorizing the move. The former president is also not shy when it comes
to potential retaliation from trading partners, which the EU, China and
others have already signalled would be applied to U.S. exports..
Tariffs on EV’s from Mexico
Trump has announced plans to impose tariffs on electric vehicles
(EVs) manufactured in Mexico, arguing that Chinese EV companies are
circumventing U.S. tariffs by manufacturing through Mexico. These could
be applied
Stripping China’s PNTR Status and other
China-related legislation
President-Elect Trump has pledged to adopt a tough approach to China,
particularly with respect to Chinese unfair trade practices and national
security challenges. In addition to the use of tariffs, export controls, and
investment screening tools, he could also turn to Congress to implement
some of his policies, including legislation to revoke China’s Most Favored
Nation trade status (PNTR), There are reports that he may be considering
attaching trade and tariff measures to the renewal of his Tax Cuts and Jobs
Act (TCJA). He has also shown support for legislation aimed at achieving
economic independence from China and preventing Chinese purchases
of American real estate through new investment screening rules, among
other national security tools.
Renegotiating USMCA
The United States Mexico Canada Agreement (USMCA) is up for review
between the three countries in 2026. President Elect-Trump and his
economic team are expected to renegotiate significant provisions of the
deal, including with respect to automotive imports and steel. Possible
changes include changes to the rules of origin around Chinese content.
