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What does 2024 US elections mean for Washington and the world
Donald Trump has recently developed an impressive role in investing promises from companies as he tries to transform the United States into a manufacturing powerhouse. Last week, the chief of semiconductor Dev Nidia indicated the “several hundred billion” dollars in the country over the next four years. Multinational car maker Stellats, Japanese Brevir Asahi, and South Korea’s automaker Hundi have recently unveiled projects for new US production. White House Claims with pride That “manufacturing win list is endless”.
Before self -related time. The Trump administration will know that it has a limit to how much investment it can attract, especially if it remains with its central strategy to try to do business in the country with taxes.
For those who start, the factory making lead time is often many years long. This means that the expensive decision to transfer the production to the United States depends partially on how long the current protectionist stand will continue. But companies have no explanation that Trump’s next week looks like plans to enforce mutual taxes, what will be US policy in a few years. Trump’s import duties affect a number of raw materials, such as aluminum and steel, producers will also wonder if the domestic supply chain will be strong enough to meet their demand.
Investors will also weigh the factors outside the revenue. The recent increase in construction costs in the US factory, which has reached the highest level of half a century in 2024, has been driven by large -scale financial concessions provided by the Biden administration. For example, semiconductor companies’ major investment promises are supported by the Chips Act subsidy. But this legislation and inflation reduction Act – which offers tax credit for investment in renewable technologies – is subordinate to Trump, which is deeply criticized.
Access to wages is another consideration. Right now, there are growing warnings from the industry that the White House plans to deport large -scale non -documentary workers, especially the manufacturing and construction sector will promote the shortage of labor, especially in the manufacturing and construction sectors. New factories may be delayed in the building. As it is, many companies complain about the process of grabbing and complex. Signs of slowdown in the US economy will also lose weight on investors’ minds. Consumers, businesses and stock markets are slipping on Trump’s inflation prices and widespread uncertainty.
This will lure manufacturers’ recent promises to the Trump administration as evidence that the risk of losing competitive access to the world’s richest consumer market is sufficient to attract investment. It has undoubtedly played its role in the decisions of some companies. But there are also wider factors playing. For example, TSMC’s recent $ 100bn commitment included funds to promote research and development activities. Given the long -time limits for the construction of factories, companies are also likely to make decades for decades, regardless of prices, to increase their US presence.
Nevertheless, for most foreign companies, the least dangerous, and extremely logical, will be the option to wait and see how the US tariff plans are ready. Other people can double investment projects anywhere, where the policy environment can be predicted. With small business, low flexible balance sheets, it may also be found that they need to reduce their US exposure. In fact, in view of the United States’ relatively high labor costs, failure to get less cost imports from abroad can make some operations less viable in the country.
There are big questions that Trump believes that focusing on manufacturing is the best way to prosper. But if the purpose is to build more factories in the country, Trump is better than removing business barriers, not increasing them.
