The BGA Thailand Team Senior Adviser Dr. Thitinan Pongsudhirak, wrote an update to clients on the policy prospects under Trump’s second administration.

Context

  • Trump will likely hasten the demise of the post-Second World War rules-based liberal international order, reinforced by a virtual declaration of trade wars and tech contests which will convulse the global economy and shake up the international system. His triumph over the Democratic Party’s Kamala Harris is overwhelming and broad-based with the capture of both chambers of Congress will embolden Trump II to double down on policy directions and measures that were first implemented eight years ago.
  • Trump’s nativist leanings at home and rejection of the established rules-based liberal international order will likely lead to a policy projection abroad that will pivot around trade protectionism and economic nationalism, on the one hand, and relative withdrawal with conditional engagement in foreign and security policy, on the other. In practice, this means international trade on U.S. terms and a strong military that will no longer be the world’s policeman.

Significance

  • We can expect U.S. industrial policies developed under the outgoing government of President Joe Biden to become outright mercantilism with direct export subsidies, import quotas and wide-ranging use of tariffs. China will be the top target of Trump II’s wrath because the Trump movement views China as a challenger of the worst kind which has stolen U.S. technology and ripped off Americans by attracting factories and jobs that used to belong to them.
  • The intellectual drivers and world view of Trump II can also spell policy prospects in other areas. For instance, while Vietnam will likely be asked to buy more from U.S. companies with its trade surpluses with the United States, the ensuing pressure may not be so intense if Hanoi can provide value in other areas, particularly in Trump II’s effort to pull down China.

Implications

  • For Southeast Asian economies, Trump II will be about geoeconomic bargaining and negotiation in view of the geostrategic threat China poses to the United States. Under Trump II, supply chains will be massively reconfigured as both Chinese and American companies leave China for safer sites in Southeast Asia and elsewhere.
  • Allies and partners who can help the United States reclaim its greatness in the international system may well be accommodated. Even China, if Beijing were to budge and back down from rivalling and competing with the United States, may also find Trump II friendlier and more accommodating.

We will continue to keep you updated on developments in the Indo-Pacific as they occur. If you have any comments or questions, please contact BGA Senior Adviser Dr. Thitinan Pongsudhirak at thitinan@bowergroupasia.com.

Best regards,

BGA Indo-Pacific Team

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Senior Advisor

Thitinan is a renowned scholar, journalist and expert in international relations and domestic politics across Asia. He has spent more than three decades analyzing and advising on Thailand and the region’s political economy, geopolitics and policy. He helps BGA and clients understand in-depth the global, regional and domestic issues that affect business.  Thitinan is a professor of international relations and international political economy at Bangkok-based Chulalongkorn University’s Faculty of Political Science and a senior fellow at its Institute of Security and International Studies. He has lectured widely at local and international universities, military colleges and international organizations on political and ... Read More