"Rural America made a difference"
Industry responds to Trump victory
The Expo Agroalimentaria, currently taking place in Irapuato, is an important meeting place for the Mexican and the American greenhouse industry. The news is a hot item at the exhibition. What will happen to NAFTA? Will importing from Mexico truly become more expensive for the Americans? Since the US has quite a high reliance on the Mexican import of fruits and veggies, both exhibitors and visitors question what the real changes and effects will be. The plummeting peso also was a topic of conversation - but since the US dollar is the main currency in greenhouse industry, this could be a positive sidenote for some greenhouse growers.
American Farm Bureau Federation
The American Farm Bureau Federation responded to the election of Mr Trump as well. President Zippy Duval congratulated the president elect, as well as those candidates elected to serve during the 115th Congress. "The important issues facing American agriculture are not red or blue, but they are critical to the prosperity of rural America and our ability to protect our nation’s food supply. We urge our elected representatives to reach across the aisle and come together to resolve the challenges we face," he said regarding the 2016 election results.
"Farmers and ranchers understand that their businesses and their families have too much at stake to take a back seat on Election Day, and rural America clearly made a difference in this election. Now it’s time for our newly elected leaders to turn up for rural America and keep their campaign promises by addressing the issues that matter to the people who sent them to Washington. Farm Bureau looks forward to working with the new administration and Congress on issues such as the farm bill, tax reform and a trade agenda focused on reducing barriers and expanding exports.
"America’s farmers and ranchers are working overtime to ensure our food supply is safe and sustainable. It’s time our elected leaders put that same diligence to work protecting U.S. agriculture by promoting innovation and ensuring we have an adequate workforce. We need regulatory reform that boosts farm businesses rather than shutting them down. Farmers are concerned for the environment and are hopeful that the new administration will recognize agriculture’s strides in sustainability and protect our ability to produce.
"Elected officials come to Washington with different perspectives and ideas, but they share a common goal of wanting to make our nation better for all Americans. At Farm Bureau, we will continue to do our part to help identify opportunities for cooperation to improve the lives of rural communities, and all American farmers and ranchers."
Mike Chapman, Horticulture New Zealand
Mike Chapman, CEO of Horticulture New Zealand, has also issued a statement following the election of Donald Trump. He emphasizes the importance of trade. "History tells us that the path to power and prosperity is trade. You can’t grow your country’s wealth by trading with yourself; you have to go and get some other countries’ wealth to become more prosperous. This is absolutely true for New Zealand, where horticulture is an enormous contributor to our nation, being the fourth largest export.
"The American people have given their President Elect a strong mandate to return the United States to economic vitality. Our trade with the US earns New Zealand over $5 billion a year, so the US market is very important to New Zealand’s prosperity. Horticulture only accounts for $200 million of that, but the US is a growth market for horticulture exports, a situation we believe will continue into the future.
"Trade is, of course, a two way street. Free trade agreements recognize that where two countries agree to reduce tariffs and other non-tariff barriers, this will result in increased trade and affluence for both paries. The opposite can also apply, where if one country increases its tariffs and barriers, the other country is likely to follow suit, leading to reduced trade and a decline in prosperity.
"During his campaign, the President Elect talked about imposing large tariffs on China and Mexico. The likely result would be those countries following suit and raising their tariffs on US goods, which would end up removing more jobs from the US as trade reduced. If that trend continued with other countries raising tariffs, the significant progress that has been made on liberalising trade in recent years will be stymied, and global trade, global prosperity, will decline.
"So to you, Mr President Elect, I say that the way to ‘Make America Great Again’ is not to raise tariffs, but to use trade and free trade agreements as a pathway to increase and secure US jobs."
Could Trump win mean the end of the TTP?
After the shock of Brexit, and now the surprise win of Donald Trump in the American election, many are now wondering what the effects will be for the ASEAN countries and Obama's Trans Pacific Partnership (TPP).
Christopher Mahon, Director of Asset Allocation Research at Barings, backed this opinion with the statement; "His most well-known campaign rhetoric involves building a wall between the U.S. and Mexico, increasing deportations and tearing up NAFTA. Outside of North America, a tougher stance on China, via the introduction of tariffs and duties, could significantly impact emerging markets. Trade deals with the EU and Japan may also be at risk."
The question is now, what long terms affects will this have on trade with China, a market that many throughout the world have been actively busy trying to enter?
Stock market plunge after election results
Stock markets also responded immediately after the election results were announced, although they did recover slightly after what many described as a gracious and very presidential acceptance speech.
"Markets have pared their earlier moves following the substantial knee jerk reaction to Trump securing an unlikely victory over rival Hillary Clinton," shared Craig Erlam, senior market analyst at foreign exchange specialist Oanda.
"While the result was unexpected, the reaction in the markets stems once again from them being poorly positioned heading into the vote, overconfident that Clinton would ease to victory, despite only having a narrow lead in the polls and being embroiled in an FBI investigation days before. The greatest oversight was the significance of the anti-establishment feeling in the US, similar to that which prompted the UK to quit the EU in June. It’s clear no lessons were learned from the Brexit vote on June 23," Erlam continued.
"Markets generally rebounded quite well after Brexit but this was aided by the rapid response of the central bank and the UK quickly getting its political house in order, providing reassurance for investors. While Trump slightly soothed some concerns in his victory speech, uncertainty remains over what kind of a US he plans to lead and the Federal Reserve is unlikely to provide the same assistance that the Bank of England did at this stage. It will be very interesting to see whether they still intend to raise interest rates next month, as they have alluded to recently."
Only time will tell how the markets will rebound and what kind of long-term effects the election of President-elect Donald Trump will bring.