What Business Owners Need to Know
As Donald Trump returns to the U.S. presidency following the 2024 election, the business community is gearing up for significant shifts in domestic and international trade. Trump’s previous term was marked by trade reforms, tariffs, and an emphasis on boosting U.S. manufacturing. Additionally, the Covid-19 pandemic during the final year of his first term reshaped both supply chains and market dynamics worldwide.
Trade Policies from the First Trump Term
During his initial tenure, Trump’s “America First” approach altered trade relationships, emphasizing domestic manufacturing and reducing dependence on foreign suppliers. Tariffs on billions of dollars in goods from China created ripple effects for industries reliant on international goods and resources.
Between 2018 and 2020, Trump’s tariffs on Chinese imports reached a cumulative value of approximately $360 billion. These policies forced U.S. businesses to pivot, find new suppliers, and re-strategize logistics. Economists note that while U.S. manufacturing grew in some areas, many sectors faced increased costs, with prices on imported goods rising as a result of tariffs.
Expected Domestic Trade Policies from the Campaign Trail
As Donald Trump enters his new term, his administration is likely to further support U.S. manufacturing through trade restrictions, tax incentives, and potential new tariffs aimed at protecting American industries.
One anticipated move is to incentivize American-made goods and discourage reliance on foreign suppliers. Keep an eye on sectors where the U.S. has been historically dependent, such as electronics and pharmaceuticals. This could translate to expanded tax breaks for companies that produce within U.S. borders, mirroring policies from 2017-2021 aimed at boosting domestic manufacturing capacity.
For logistics and supply chain professionals, a renewed emphasis on domestic production could shift demand patterns. Supply chain analysts project that reshoring efforts may intensify, creating challenges for those reliant on overseas production . Businesses may need to reconsider sourcing strategies, especially in high-demand industries like healthcare, automotive, and technology.
Small and medium-sized businesses might face unique challenges as tariffs rise. Trump repeatedly stated on the campaign trail that he would impose a minimum 10% tariff on all imported goods with a 60% tariff on goods from China. It is unclear whether these tariffs will become a reality as numerous economists warn of the negative effects. If they are put in place, businesses ready to pivot to domestic suppliers could benefit as the rest of the market races to catch up.
International Trade Policy Shifts and Trade Tensions
Trump’s prior administration initiated unprecedented tariffs on countries like China and allies like the European Union. The return of such strategies would renew trade tensions.
Following his return to the White House, Trump could renegotiate or withdraw from certain trade agreements. The president-elect said as recently as October that he wants to revisit the agreement he signed in 2018. “I want to make it a much better deal. I want to take advantage, now, of the car industry.” These potential changes may bring about stricter regulations on imports.
Industry-Specific Impacts to Watch
Different sectors will experience unique impacts based on Trump’s trade policies, with some industries benefiting and others facing challenges.
Domestic manufacturing could see a boost with incentives to reduce reliance on international suppliers, particularly for goods in critical sectors such as defense, electronics, and pharmaceuticals. Analysts suggest this may lead to job growth within the U.S., though higher costs may impact product pricing. CEOs like Elon Musk, who provided $130 million to the Trump campaign in its closing days, are betting big on the once and future president. So far, that bet appears to be paying off as Tesla stock climbed 15% the morning after the election.
One area that is not so rosy is agricultural exports. China instituted their own tariffs on soybeans and pork, in return for the Trump tariffs. Agricultural exports may once again be vulnerable to trade wars. “When we start putting tariffs on others, usually the retaliatory tariffs end up on American agricultural products,” said Bob Hemesath, a soybean farmer and the Chairman of Farmers for Free Trade.
With Trump’s previous emphasis on protecting American intellectual property, there may be tighter regulations on technology imports and exports. This is especially true for sectors where cybersecurity and intellectual property rights are at stake. Restrictions on hardware imports could impact technology firms dependent on foreign-sourced components.
The return of Donald Trump to the White House brings opportunities and challenges for American businesses engaged in domestic and international trade. From tariffs to regulatory changes, businesses will need to adapt. By preparing strategically—diversifying supply chains, planning financially, and monitoring compliance—business owners can position themselves for resilience in the global market.
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