A second term for Donald Trump promises to revive “Trumponomics” – policies defined by protectionism, deregulation, and strong-arm geopolitical tactics.
Douglas Grant, managing director at Manx Financial Group looks at why for UK SMEs, navigating a post-Brexit economic landscape could become more complex. At the same time, new openings for growth may emerge, particularly around overseas trade and supply chains. Below, we explore five key areas likely to shape both the challenges and opportunities ahead.
Trade barriers and tariffs vs. strengthened UK-US trading relations
Trump’s emphasis on “America First” is likely to involve increased tariffs and robust domestic priorities. These measures could raise costs and regulatory hurdles for UK SMEs selling into the US market, dampening competitiveness and raising uncertainty around existing trade agreements.
However, any surge in US protectionist policies might also encourage the UK to align with other similarly affected nations, potentially leading to alternative trade partnerships outside the US and China. To capitalise on such shifts, SMEs should keep a close watch on trade negotiations, prepare to adapt their export strategies, and track fluctuations in currency and regulations.
Regulatory changes and market volatility vs. favourable tax policies
Trump’s track record of deregulation could make it more challenging for UK businesses to stand out in an increasingly competitive US domestic market. Meanwhile, his unpredictable approach to policymaking may trigger market volatility, affecting exchange rates and investor confidence. UK firms will need to stay agile, planning for the potential impact of abrupt changes.
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