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Influences of economic policy of Donald Trump and responses

Author Moon, Jongchol Date 2016.11.17 Issue No 636

 As concerns are growing over uncertainty and unpredictability after Donald Trump’s winning the presidential election, it seems certain that the U.S. will strengthen the move of protectionism during the new administration of Trump. This move can cause the U.S. to be cautious of Korea’s export, and can possibly make the U.S. demand for renegotiations of Korea-the U.S. FTA. Bigger problems of Trump’s economic policy are the country’s business slump, drops in domestic demand, and dwindling trade volume in each and every corner of the world, accordingly, and it will deal a blow to the export-oriented Korean economy. Particularly, it is deemed to cause a negative impact on various industries, for example, steel, chemistry, white goods, the high-tech industry, auto industry, textile industry, etc. Yet, Trump’s political pledges on economy can turn into opportunities. America’s delaying or canceling TPP may work favorably for Korea in a rivalry relationship with Japan. Making most of political pledges of the president-elect of expanding infrastructure investments and of energy, a new export demand can be created in the relevant industries. In order to turn the challenges from Trump’s political promises into opportunities, we must avoid holding negative perspectives on whether Trump would follow through his election pledges, but we need to have a careful observation and a rapid response to Trump’s moves. We need to find and make the most of positive aspects of Trump’s economic policy, and strengthen relevant relationships to change Trump’s negative perspectives on Korea-the U.S. FTA. Also, it is necessary to draw a broad picture for the result of Korea’s presidential election that will take place in a year.