As the world’s largest economy and a dominant force in global trade, the United States is once again at the center of global attention following Donald Trump’s return to power. Within his first week back in office, President Trump signed 45 Executive Orders—several of which have important implications for international trade and economic policy.
Whether or not your business directly trades with the U.S., its economic policies inevitably shape global markets, supply chains, and investment flows. This blog explores the transition from the Biden to Trump administration and examines key developments that could impact your international expansion strategy.
Implementing Tariffs on Imports from Mexico, China, and Canada
For businesses looking to grow internationally, recent tariff changes could influence costs, supply chains, and pricing strategies. On 1 February 2025, President Trump signed three executive orders imposing tariffs—25% on imports from Mexico and Canada and 10% on Chinese imports—citing concerns over illicit drug flows and unfair trade practices.
While a temporary delay has been granted for Mexico and Canada in exchange for stricter border enforcement, all three countries have vowed retaliatory measures. China has already imposed tariffs on American LNG and coal while launching an antitrust investigation into Google’s parent company, Alphabet.
What This Means For Your Business
Even if you don’t trade directly with the U.S., these tariffs are expected to send shockwaves through global supply chains. Costs are set to rise, supply chains could be disrupted, and new trade barriers may complicate your international expansion efforts. Here’s what you need to prepare for:
Adjustments to Supply Chain Costs – For businesses relying on automotive components, electronics, or textiles, these tariffs could mean higher costs. Analysts at Jefferies estimate that the 25% tariff on Mexican and Canadian imports could add about $2,700 to the price of an average U.S. vehicle, which could have ripple effects on global suppliers and manufacturers.
Agricultural Market Shifts – Businesses in the food and beverage industry should brace for significant cost increases. The U.S. imports approximately $3.1 billion worth of avocados and $4.87 billion worth of beer from Mexico annually. With tariffs in place, importers and retailers will face higher costs, which will ultimately be passed down to consumers. This could squeeze margins for businesses in F&B, hospitality, and retail that rely on these goods.
Regulatory Changes for Tech Firms – For technology firms, China’s antitrust investigation into Alphabet could introduce additional regulatory challenges. Businesses relying on Google for software and cloud services might face hurdles when entering and operating in the Chinese market.
Global Economic Trends – Even if your business operates outside these sectors, the broader economic impacts are noteworthy. The World Bank has warned that these tariffs could reduce global economic growth by 0.3% in 2025, wiping out approximately $255 billion in potential output. Industries like consumer goods, electronics, and fashion will feel the most significant impact, as businesses scramble to find alternative suppliers or navigate new logistical challenges. This global shift could also lead to supply shortages, price hikes, and delays, ultimately making it harder for businesses—especially those trying to scale internationally—to stay competitive.
Trump’s Rollback on Climate Protections and Policies
As of January 2025, President Trump has signed multiple executive orders adjusting environmental policies. Most notably, the U.S. has withdrawn from the Paris Climate Agreement. Additionally, the administration has announced plans to ramp up oil and gas production, remove federal incentives for electric vehicles (EVs), and ease environmental regulations that curbed industry emissions under the previous administration.
These policy shifts may create new opportunities for some industries while requiring adaptation in others.
What This Means For Your Business
Depending on your industry, Trump’s move away from its previous stance on climate protection may represent a double-edged sword. On one hand, your business could benefit from reduced costs and larger profit margins, but on the other hand, increased competition and new trade hurdles are to be expected. Here’s what you can expect, summarised:
A Mixed Outlook for the Automotive Industry – For the automotive industry, the removal of electric vehicle subsidies and the relaxation of emissions regulations could reduce production costs and improve margins for U.S. automakers. If your business supplies materials to the automotive sector, demand for steel, aluminum, and combustion engine components may increase, while demand for electric vehicle-related materials such as lithium and cobalt could decline. However, this shift may also create obstacles for U.S. automakers looking to export to Europe or China, where environmental regulations are tightening. The European Union’s Carbon Border Adjustment Mechanism, which will impose emissions-based tariffs on imports by 2026, could result in higher costs for American vehicles that do not meet stricter environmental standards.
Energy Market Adjustments – The energy sector will also experience significant changes. The expansion of domestic oil and gas production may lower fuel prices, benefiting businesses reliant on transportation and logistics. However, renewable energy companies could face declining demand in the U.S. as federal incentives disappear. This is significant as in 2023, U.S. renewable energy growth outpaced fossil fuel expansion for the first time, with solar and wind accounting for 14 percent of electricity generation. Thus, reversing these policies could slow this momentum, forcing green-energy firms to explore international markets or adjust their business strategies to remain competitive.
Navigating Global Market Expectations – There is also the risk that U.S. industries may become increasingly isolated from global markets. While domestic deregulation may provide short-term advantages, other nations are strengthening their sustainability policies. European and Asian economies are aggressively investing in renewable energy and emissions reductions, while global investors continue to prioritize companies that meet environmental, social, and governance (ESG) standards. Therefore, if you are considering international expansion, you should align your business practices with evolving regulations to maintain your competitive advantage in your target markets.
Adapting to the Changing Trade Landscape
President Trump’s policies will have varying effects on businesses worldwide. While deregulation and lower domestic production costs may offer advantages, shifting trade dynamics, evolving environmental policies, and global market responses will require careful planning.
For businesses looking to expand internationally, staying informed on trade regulations, supply chain shifts, and sustainability trends will be key. Diversifying suppliers, exploring alternative markets, and adapting to regulatory changes can help mitigate risks and ensure long-term success.
Ultimately, whether these changes present opportunities or challenges depends on your industry and strategic approach. Businesses that proactively plan for shifting trade conditions will be better positioned to navigate the evolving global market landscape.
