It’s official: America has elected its next President. Donald Trump will return for a second term after a four-year hiatus. The world that Donald Trump left four years ago is a very different one. There have been many changes over four years – both positive and negative for the economy, shipping, trade, and business writ-large. What does a second Trump term look like for the shipping and supply chain industry?
Effects on Foreign Policy for Shipping and the Supply Chain
President Donald Trump took a different approach to foreign policy than his Democratic predecessor Barack Obama when he took office nearly eight years ago. In his first term in office, Trump reached out to Russia, China, North Korea and other U.S. adversaries, and made it through most of his first term without a major conflict abroad.
However, the world is different now. The U.S. left Afghanistan a few years ago and no longer has a major wartime troop deployment abroad. Russia invaded Ukraine in 2022 and that war is still ongoing. Hamas, based in the Gaza Strip, attacked Israel last year and an ongoing conflict is occurring in the Middle East. Iran has gotten involved.
With President Trump elected to a second term, it’s likely he will continue to fully support Israel’s government, which could prolong the conflict in the region, with further escalation with Iran possible. This could lead to volatility in many areas, including fuel prices which could increase shipping costs.
At the same time, the war in Ukraine is likely to be brought under control, as President Trump favors mending relations with Russia. This could ease pressures on grain exports, as well as lift some shipping uncertainty in the Black Sea and surrounding region.
Effects on Domestic Policy for Shipping and the Supply Chain
President Donald Trump has his eyes set on several areas of domestic policy, all of which are sure to affect shipping and the supply chain over the next four years. First, the trade deficit and protectionism. As we’ve previously reported, Trump campaigned on tariffs as a major part of his platform. If across-the-board tariffs are implemented, it could raise prices for goods and affect shipping demand. There may be an additional boom in shipping as demand skyrockets ahead of tariffs.
President Trump is likely to tackle tax cuts. Expanding on his 2017 tax cut, Trump may offer new incentives to builders for infrastructure upgrades, including for ports and supply chain infrastructure. This could lead to ports being upgraded and newer facilities being constructed.
In general, there are likely to be fewer regulations in place and many government agencies, including those who oversee shipping and maritime trade, will be affected. The Federal Maritime Commission is likely to change regulations, as well as U.S. Customs and Border Protection.
One thing is for sure: the shipping and supply chain industry will see change over the next four years.
