Just hours after his inauguration as the 47th President of the United States, Donald Trump wasted no time in asserting his agenda. He signed an unprecedented 78 executive orders, swiftly undoing many policies put in place by his predecessor, Joe Biden. His supporters, ecstatic after waiting for hours in the cold, saw these actions as the dawn of a new era—one that would bring change and, for many, a sense of American nationalism.
However, as Trump kicks off his second term, it is becoming increasingly clear that his administration may steer the world into turbulent waters, especially regarding trade and international relations.
Trump’s first term was defined by an aggressive "America First" approach, particularly on trade. His use of tariffs, protectionist policies, and a combative stance toward global trade partners, most notably China, created significant volatility in both global markets and diplomatic relations. If Trump continues along this path in his second term, businesses and countries worldwide may be faced with even greater uncertainty.
One of the most immediate and obvious consequences would be the potential for the U.S.-China trade war to intensify. Throughout his first term, Trump imposed substantial tariffs on Chinese goods in an effort to correct what he viewed as unfair trade practices and to reduce the U.S. trade deficit. While there were moments of negotiation, the relationship between the two largest economies in the world remained tense.
A continuation or escalation of these tariffs would increase costs for U.S. businesses that rely on Chinese supply chains. Industries like technology, manufacturing, and agriculture, which are heavily integrated into global supply chains, could suffer from rising costs and disrupted production timelines. The ripple effect would not be limited to the U.S. alone—countries in Europe, Asia, and emerging markets, all of which depend on trade with China, would likely bear the brunt of these tensions.
The consequences for global financial markets would also be profound. As seen at the start of his second term, Trump’s mixed signals about trade policies are already sending shockwaves through stock prices, which can fluctuate wildly in response to the slightest hint of policy changes. For investors, the lack of a clear trade direction could lead to heightened uncertainty and increased market volatility. Industries with strong international ties—such as technology firms, automakers, and agricultural exporters—would be especially vulnerable to market swings. This instability could also have broader effects on the global economy, as companies adjust to uncertain conditions and growth projections are revised downward.
Beyond trade, Trump’s more unilateral approach to foreign policy could exacerbate tensions in an already fragmented global environment. His first term saw the U.S. pulling out of several key international agreements, such as the Paris Climate Accord and the Iran nuclear deal.
A similar approach in his second term could weaken the influence of international institutions like the United Nations (UN) and the World Trade Organization (WTO), leaving countries to pursue their interests without coordination. In a world where global challenges like climate change, public health, and security require collective action, such fragmentation would hinder the ability of nations to effectively address these issues.
In the end, Trump’s second term promises to be a bumpy ride for the global community. Mixed messages on trade policy, coupled with the possibility of escalating tensions with China and a more isolationist stance on foreign relations, could leave the world grappling with economic instability, market volatility, and a growing sense of geopolitical disarray.
For businesses, investors, and governments alike, navigating this uncertain terrain will require careful strategy and adaptability. However, one thing is clear: Trump’s approach could lead to a more divided and unpredictable world, making global cooperation all the more challenging.
The writer is a student of Independent University, Bangladesh (IUB).
BDST: 1711 HRS, JAN 21, 2025
MN
