Trump Election Win Sets Stage for Aggressive Trade Controls

Although the increasing reliance on trade controls used by the U.S. was expected to continue no matter who won the presidential election (see 2410180040), policy analysts have said Trump may make more aggressive and blunter use of extraterritorial export control tools and financial sanctions, particularly against China (see 2410150063 and 2409230007). Others predicted Trump will be more likely than his opponent, Vice President Kamala Harris, to bristle at EU trade rules that may cost U.S. exporters, including the bloc’s upcoming carbon border tax (see 2410170036).

And when Republicans take control of the Senate in January, they will be in a stronger position to advance their views on a range of export control and sanctions issues, including those dealing with China and Iran.

In recent months, Senate Republicans, including Sens. John Kennedy of Louisiana and Marco Rubio of Florida, have called for the Biden administration to impose tighter restrictions on sales of advanced computing chips to China (see 2409030029 and 2407090030).

A spokesperson with China’s Foreign Affairs Ministry declined to say how Beijing might respond if Trump introduces new trade restrictions, including by sharply increasing tariffs. China is hoping to work closely with the next U.S. administration to keep the two sides’ relationship “peaceful,” a foreign affairs ministry spokesperson told reporters Nov. 6.

“We will continue to view and handle our bilateral relations under the principles of mutual respect, peaceful coexistence and win-win cooperation,” the person said.

Republican senators, including Rubio and Sen. Jim Risch of Idaho, also have pushed the administration to speed up implementation of new Iran sanctions measures that President Joe Biden signed into law in April (see 2409190053).

Sen. Tim Scott, R-S.C., who is expected to become chairman of the Senate Banking Committee, has criticized the administration’s new restrictions on firearms exports, saying they hurt American businesses (see 2407250037). It's unclear whether Trump would reverse those rules, although his administration led an effort in 2020 to transfer authority over small arms exports from the State Department to the Commerce Department, which some viewed as weakening firearms export restrictions (see 2001170030 and 2401250069).

Foreign leaders around the world congratulated Trump on his victory, including European Commission President Ursula von der Leyen, who said she looks forward to working with Trump on a “strong transatlantic agenda.” Her comments came days after the incoming EU trade chief promised to cooperate with the new administration but also “stand up” to any “disruptive” trade restrictions (see 2411050045).

Von der Leyen said “millions of jobs and billions in trade and investment on each side of the Atlantic depend on the dynamism and stability of our economic relationship.”

Sanctions Advisory, an EU-based consulting firm, said companies that monitor trade controls should expect a "constantly shifting sanctions landscape" that could match the unpredictability experienced by shippers, forwarders and multinational firms during Trump's first term. "Updates and changes are likely to be frequent and very well may be unaligned to any clear foreign policy agenda," it said Nov. 6.

The firm expects a new Trump presidency "to pick up where the first left off," although possibly with more officials willing to toss aside traditional trade guardrails.

"While in the first administration, many officials resisted Trump's impulses, this term will likely feature appointments based on loyalty rather than independence," it said, "with only the most trusted figures in pivotal roles such as Chief of Staff and National Security Advisor."

The Information Technology Industry Council, which represents many of the world's leading technology companies, said it's optimistic the Trump administration will push forward policies, including in the trade realm, that support its members.

"The incoming Administration can maintain the United States’ lead in the global AI race, create a globally competitive tax system, and advance key U.S. trade, economic, and national security objectives," ITI CEO Jason Oxman said.

The Information Technology and Innovation Foundation said one of the main issues it's following is how Trump will reverse what it called the ongoing "loss of techno-economic power to China" and restore U.S. leadership in advanced technology industries.

The Aerospace Industries Association, which has lobbied for reduced export license requirements for dual-use and defense trade with close U.S. allies, said it looks forward to "collaborating closely with the new Administration" and Congress.

"In the face of geopolitical turbulence and strong economic headwinds," AIA will focus on "supporting American leadership in aerospace and defense; igniting innovation and job creation; and strengthening our national security," President Eric Fanning said.