The financial markets have reacted negatively to the election of Donald Trump as the President of the United States of America. The financial markets seem to react negatively to anything that the media decides to project. Indeed, market reactions are made up of perceptions.
The election of Trump following the Brexit results is an important lesson to the political class. The world is seeking a change in the way things are done. Certainty is fundamental but it does not mean that it should impede change. During his campaign, Trump made very far-reaching statements and promises without however entering in the detail of how they can be implemented. He has also failed to offer alternatives to the laws or actions he has promised to abolish.
Trump is first and foremost a business person. Since 1971 he has chaired The Trump Organization, the principal holding company for his real estate ventures and other business interests. During his business career, Trump has built office towers, hotels, casinos, golf courses, and other branded facilities worldwide. He received a bachelor’s degree in economics from the Wharton School of the University of Pennsylvania in 1968. In 1971, he was given control of his father Fred Trump’s real estate and construction firm. Trump has appeared at the Miss USA pageants, which he owned from 1996 to 2015, and has made cameo appearances in films and television series.
With this background, Donald Trump, must certainly understand the requirements for a healthy business environment. With a number of projects around the world, he certainly will seek good relations with different countries. Perhaps we will see a reconciliation with Russia, which is much needed in the business world and not only. The Obama administration led to many countries holding back on business transactions with Russia, just to please the USA. Indeed, there was a strategically coordinated effort to control and limit transactions under the pretence of money laundering. Malta had its share in all this as well, as we may recall, similar statements were made on Russian investment even from Government representatives. On the wake of the Trump election, Prime Minister Joseph Muscat will hold talks in Moscow with Russian Prime Minister Dmitry Medvedev on Tuesday 15 November 2016. The Russian government said they will discuss multilateral cooperation, including investment. They will also touch upon some issues related to Malta’s presidency of the Council of the European Union in the first six months of 2017. Perhaps, thanks to the Trump election we will see stronger ties with this economic power.
Trump’s promise of withdrawing support to Syrian rebels is also a positive side from a business perspective. Stability in the area is much needed. The world should seek to stop terrorism and not to interfere in country affairs. Hopefully, Trump will change the mentality of the USA of going into useless wars and create instability in regions. There are different ways of how to handle certain humanitarian issues. So finally, we may also be given the green light to start trading with Syria and to once again be able to visit this marvellous historic land.
There are also other issues at play, such as dealing with illegal immigration. We will need to see how this will be handled. However, we should not be surprised that the Americans voted for this. Indeed, this matter has been discussed in Malta for years and years which led to a level of unprecedented vitriol which was openly aired in public forums. Reducing the problem of illegal immigration led to a more serene view by the Maltese who seem to accept a more multicultural role. In the case of America, it must be the same. One must admit that there may be businesses who will be negatively affected by the reduction of the consumer population. However, addressing the matter may result in higher income in taxes for Government, reducing abuse of working conditions (possibly forced labour) and also entering part of the black economy in the system.
In his promotion of stability, Trump has also promised to stop Islamic State. One of his probable basic assumptions is that much of such activity may be starting in the US itself. So by taking certain measures and by possibly managing to stop financing of the terrorist group they will be weakened. If he manages this, then we would have other geographical regions to engage into business with. Reading through his promises, one may see that most of these do have a pro-business stand through which the whole world stands to gain and not just the Americans.
Indeed Trump said he would put in place “the largest tax cut since Ronald Reagan” and offered less specific ideas such as eliminating “every unnecessary, job-killing regulation,” protecting religious liberty and rebuilding the military and law enforcement.
Whether he will succeed or not, still needs to be seen, but anyone who is interested in business generation will be looking forward to see whether certain promises will become reality.