Cornering the Globe: Back to the Future: Trump, trade, and geopolitical opportunities amidst uncertainty

April 2017

Overview

Within the first 100 days of the Trump administration, global investors have pared back their positions from the ‘Trump trade’ due to uncertainty surrounding the President’s ability to follow through on promised tax reform, fiscal stimulus, and infrastructure spending. With that in mind, where do the long-term opportunities exist, both in the U.S. and the rest of the world? 

Key insights from the report include:

  • At the macroeconomic level, a certain amount of prudence is recommended in looking at the prospects for Trump stimulated economic growth in the U.S.
  • The U.S. economy - and the Chinese economy - are creating wealth in services - and the trade of services - beyond manufacturing. Emphasis needs to be placed on the skills and training of workers to fulfill these ‘new economy’ jobs. 
  • At the geopolitical level, investors are pouring into emerging market equities and bonds, favoring Brazil and divesting in Mexico. However, looking beyond short-term capital flows, opportunities exist for asset managers and multinational corporations (MNCs) to harness current volatility and allocate capital for long-term growth in emerging markets (EMs) - no matter if it is a China or U.S.-led world. 

About PwC’s Cornering the Globe publication series:

Cornering the Globe is a publication of PwC’s Geopolitical Investing practice, and is intended to highlight key issues our clients should be considering as they think about expanding into global markets. At the Macro level, long-term economic and demographic trends indicate an abundance of opportunities to profit and expand in emerging markets. However, the risks of doing business in these regions - such as exchange rate volatility, political uncertainty, meeting the skills gap, and shifts in tax and regulation - often hamper decision-making, forcing companies to react to events, rather than prepare for change, and capitalize on potential dislocations. By critically assessing key geopolitical issues that impact our clients, we provide insight into the ways in which companies can build capabilities to weather political and economic change in their foreign operations. Our Geopolitical Investing team combines rigorous insight into the key macroeconomic and geopolitical issues facing business leaders today, with deep industry and sector expertise, helping companies to strategically allocate capital to grow specific business units or assets in markets around the world.

Contact us

Dr. Alexis Crow
US Advisory, Lead, Geopolitical Investing Team
Tel: +1 (212) 203 8609
Email

Brian Dunch
US Advisory, Risk & Regulatory Principal
Tel: +1 (703) 835 5994
Email

David Sapin
Technology, Media and ​Telecommunications Risk and Regulatory Leader
Tel: +1 (202) 756 1737
Email

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