The name Donald Trump brings controversy wherever it goes. It doesn’t matter if it’s in a reality show or if it’s in politics. Prime Minister Hun Sen even noted that he preferred Trump to win because it would ease tensions between Russia and improve global cooperation. And the prime minister did get his wish. Donald Trump has been named President of one of the most powerful countries in the world.
But what does this mean for countries in Southeast Asia?
Marc Townsend – the Managing Director of CBRE Cambodia and Vietnam – discussed the implications during his presentation “Is Cambodia’s Residential Market a Target For Investment?”
An Interesting Change:
Townsend mentions that Cambodia may not be directly affected by Trump’s victory. But he warns that Cambodia may not remain completely unfazed by it either. A trans-pacific partnership has been in the works during the Obama administration to enhance trade among 12 countries by means of free trade zones. But this may have hit a dead zone as Trump has expressed opposition towards this specific trade agreement. No decision has been made about the issue yet.
Townsend explains “it will be interesting to see whether that happens. Obviously, Cambodia’s not so much involved in that. But the ripple effect will be interesting. Obviously, with Mr. Trump’s election future trade agreements become increasingly distant.”
The Ripple Effect:
The hostile treatment of the United States government under the Trump administration will focus on an “Americans First” master plan. This means providing more jobs to Americans by removing most outsourcing industries. Trump might impose higher tariffs on import as well.
Fortune mentions that “any such moves could also hurt Asian exporters who ship components there for assembly and export to the United States, at a time when global trade is already weakening.”
It is important to note that most of the countries that will be affected by this change are major investors of Cambodia. A weakening of their trade policies with the United States of America may spell trouble for the country given its reliance on industrial based exports.
The Dashboard from CBRE Cambodia:
Townsend said “We put this dashboard together every month. And you can see here, particularly, it’s important to see where we’ve come from, where the FDI numbers have come from, where they’re going to.” His presentation showed no future FDI estimates from CBRE as a result of the uncertainty that the Trump administration may bring. They do expect stable GDP growth though.
It is difficult to see how Trump’s going to play the presidency out until he reaches his first 100 days. But many are still hopeful that his making America great again will include better foreign trade agreements with nations such as Cambodia.