The victory of Donald Trump in the US Presidential Election.
International markets reacted negatively to the victory of Donald Trump in the US Presidential Election this morning, although we are now seeing some stability returning. KPMG’s experts have assessed what the vote might mean for UK business and its employees.
Karen Briggs, Head of Brexit at KPMG, added:
“Before yesterday, there was a sense that Brexit was part of a global narrative. Now the Trump victory has confirmed this. But because of the narrative, the risk to the UK as a destination for international business is that we are lumped into the populist axis. Certainly the rush to safety we saw in the initial results of the vote suggested sterling wasn’t viewed as a safe haven, compared to gold and the Yen. Moreover, this movement may increase populist momentum across Europe and complicate article 50.
“While stock market shocks today and in the coming weeks are likely to hit pension pots, the attitude of the US to trade is one of the biggest areas of interest for many UK businesses in the longer term. Of course, this is most relevant to those companies who trade directly with the US. The UK is the US’ fifth largest export customer and the seventh largest supplier to the US economy. Will the Trump victory represent an opportunity to be first in the queue?
“Similarly to Brexit, we expect to see our clients reviewing M&A activity, capital and equity markets activity in the short term and then their supply chains in the coming weeks. Trump will be in post in January. For the business community, the team he builds around him – not least the head of the Federal Reserve - will be of particular interest as they try to predict how the campaign promises turn into concrete policy.”
Punam Birly, Head of Immigration Law at KPMG, commented:
“The lessons of Brexit teach us that people come first in a shock political situation and not just the most obviously affected people. We found that international workers in the UK were worried by the vote to leave the EU, not just Europeans. While businesses sending employees to the US are unlikely to face business immigration restrictions in the short term, international workers are sensitive to tone and sentiment, on which they base important decisions about where to locate themselves and their families. Given the rhetoric in the run up to the election, UK businesses with workers in the US and international workers more broadly, should be acting quickly to provide sensitive reassurance. Certainly both Trump in his acceptance speech and Clinton in her concession speech led with a message of inclusivity.”
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For further information please contact:
Sorrelle Harper, UK Head of Communications, KPMG
T: +44 7932 078218 / +44 20 7694 8527
KPMG Press office
T: +44 (0) 20 7694 8773
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