China may face economic setbacks as Trump 2.0 raises export risks
This will likely lead to a larger stimulus package from Beijing.
The broader economic and geopolitical implications of Trump 2.0 are expected to negatively affect Asia, particularly China.
A Nomura report said that the new president’s victory increases the downside risks to China’s export growth, potentially prompting a larger stimulus package from Beijing.
In line with this, China is expected to implement stimulus closer to 3% of GDP annually to offset potential export growth slowdowns from trade policies.
“Compared to closer to 2% of GDP we would have expected under a Harris win,” Nomura said.
However, some countries stand to benefit with India poised to be a relative winner amidst deep economic and strategic ties with the US.
With the US viewing it as a counterbalance to China in foreign policy, India could benefit from ongoing supply chain diversification and increased foreign investment, helping to offset any potential trade frictions.
Moreover, Malaysia is also set to benefit from increased foreign direct investment as multinational corporations diversify supply chains.