As one of the most controversial elected US presidents, Donald Trump has businesses all over the world wondering how his time in office will affect their business.
The entrepreneur aims to bring business interests to light while in power but does that mean his run will mean good things for business, both US or foreign? Here’s how business in the UK might be affected by his presidency:
Exports to US
One way that the new President’s ideas could affect UK business is through exports. With a greater emphasis on home grown suppliers, this could mean fewer opportunities for foreign businesses
to sell to the US.
UK small businesses do well in the US market. The US is the biggest export destination for UK manufacturers, worth £29.2 billion this year. The UK also has the highest proportion of SMEs exporting to the US at 43% of the EU economies.
Trade between the US and the UK is generally seen as a safe option, with the common language and business practices. However there have already been signs that UK exports are seeing a decrease in demand. Even before the election, SMEs in the US were starting to look closer to home for goods. This means that UK businesses may have to rethink how they approach new business in a post-Trump US.
Transatlantic Trade & Investment Partnership (TTIP)
Trump is unlikely to go ahead with this deal with the EU, considering his previous comments on it. This means that the US is unlikely to benefit from a free trade agreement with the EU and it looks like the UK will be in the same position.
If trade is restricted this could mean slower growth for the US which then affects all the other countries it does business with, including the UK.
Uncertainty hits business confidence
The markets initially reacted poorly to the election results. While they seem to be stabilising somewhat, this could be an indicator of the future, much in the same way that the markets reacted to the news of Brexit. In times of uncertainty businesses are more hesitant to make business decisions and investments in the short term.
However, the good news for the UK is that it can take advantage of sterling’s current value because now people might be more likely to buy British goods at the cheaper rates. While it’s a hit that the manufacturers might have to take, it could make up for itself with an increase in demand. Trump has voiced his opinions regarding Brexit, congratulating the UK and insists that it makes no difference whether the UK is in the EU or not.
Are you worried about how Trump’s presidency could affect your business or are you more optimistic? Let us know your thoughts in the comments below.