Trump Win Prompts Lawyers Around the World to Prepare for Uncertainty
Trade tensions are expected to increase as Donald Trump seeks to unleash a slew of tariffs during his second term as U.S. president.
Lawyers worldwide expect Donald Trump’s second term as U.S. president to bring heightened trade tensions, an intensification of the U.S.–China rivalry, and a lot of work for Big Law.
“The last Trump administration was probably one of the most intense and busiest times we’ve seen. He generates a lot of work for lawyers in all jurisdictions,” said Jesse Goldman, a Toronto-based competition and trade partner at Osler Hoskin & Harcourt.
Trump’s first term involved a tense renegotiation of the USMCA trade agreement between the U.S., Mexico, and Canada that set North America on edge. Trump has now pledged to save U.S. manufacturing and bring back jobs by rewriting that trade deal. The difference today is that the U.S. is locked in a fraught battle to wrestle supply chains away from China and back to the Americas, with Mexico positioned as a key ally in those efforts.
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The Americas
Juan Francisco Torres Landa, the Mexico City–based Latin America practice leader at Hogan Lovells, expects the Trump presidency to bring “a new phase of instability [to Latin America] given the protectionist and one-sided view of the relationship with Latin America.”
The USMCA has a sunset provision that calls for the free-trade agreement to effectively terminate after a specified time frame unless it’s renewed. That sets the three North American economies on course for a potentially perpetual negotiation starting in 2026 when they’re due to review the current framework.
“The leverage will continually be with the U.S. to say, ‘These are the issues that we have with the agreement, and please resolve them if you want us to extend the agreement,’” said Clifford Sosnow, partner and chair of the international trade and investment group at Fasken Martineau DuMoulin in Toronto.
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Africa
Meanwhile, China is actively investing in South America and Africa to secure iron ore, lithium, and other critical elements.
Dayo Okusami, a partner at Nigeria’s Templars, believes a Trump presidency will check China’s increasing influence across Africa, which could lead to more U.S. deals on the continent, especially in mining.
“The U.S.–China rivalry will intensify in Africa, especially focused on critical minerals and their supply chains, as Africa holds 30 percent of the world’s known reserves of critical minerals,” Okusami said.
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Asia
Icy relations between the U.S. and China, which predate Trump’s return to power, have stymied deal activity in China. China-based lawyers are now expecting an increase in geopolitical tensions.
James Zimmerman, a Beijing-based partner at Loeb & Loeb, said he has been reminding clients that the rhetoric of “daily China bashing might never materialize into actionable initiatives coming out of Washington, D.C.” Still, he anticipates that a second Trump administration will echo the first, “with a foreign policy that is chaotic and lacking in diplomacy, and not just with China.”
India has positioned itself as a crucial counterweight to Chinese power, notes Amit Singh, the Singapore-based head of Linklaters’ India group who sees smooth sailing ahead for the Indian legal market. India is “a very valuable ally for the U.S. in the region, and I don’t think that is going to change,” said Singh.
Steven Klimt, a Sydney-based banking and finance partner at Clayton Utz, worries a Trump presidency could trigger a slowdown in global deal-making and merger and acquisition (M&A) activity. If Trump’s promised tariff policies stoke inflation, as some economists predict, interest rates could rise again and economic growth could slow, Klimt warned.
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Middle East
Deal-making could also slow in the Middle East, where the United Arab Emirates (UAE), Bahrain, Saudi Arabia, and Kuwait are seeing record-high foreign investment and economic diversification, backed by high oil prices.
Sachin Kerur, Reed Smith’s Middle East managing partner, said: “A Trump win means we can expect incoming changes to U.S. trade tariffs, a shift in national energy policy, and geopolitical deal-making. This, of course, means companies operating in the Middle East will be impacted and have to adapt to a shifting landscape as new policies are implemented.”
At the same time, some anticipate that a Trump administration could bring a measure of peace and stability to the Middle East. One partner at an Am Law 100 firm based in Dubai said some in the region respect Trump more than the Democratic administration, which could help de-escalate tension between Israel and Iran.
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Europe
European lawyers are preparing for disruption to trade and potentially to deal-making. Ken Daly, managing partner of Sidley Austin Brussels and co-head of the antitrust and competition practice, said the Trump campaign rhetoric suggested a near-term focus on tariffs and other protectionist measures.
“It seems like important policy changes may be coming, so we expect demand for expertise in these areas to be very high, as our clients face a period of uncertainty,” said Daly.
Iván Delgado, international executive partner at Spain’s Pérez-Llorca, is taking cues from Trump’s focus on protectionist, business-friendly policies and reduced regulatory constraints.
“European and Spanish companies may face a more fragmented and uncertain adaptation period, which might require legal advice that is more focused on risk mitigation, particularly in sectors such as automotive, agriculture, and manufacturing, where tariffs or trade restrictions could directly impact supply chains and market access, as well as commercial dispute management,” Delgado said.
Yet European lawyers also expect that large economies will continue to position themselves as U.S. allies. Bertrand Cardi, a corporate, M&A, and capital markets partner at Darrois Villey Maillot Brochier in France, said that in Europe, Trump’s re-election “should also serve as a wake-up call that it needs to work more on unity, sovereignty, and economic development, both to reinforce its role as a strong ally and to support European values and influence worldwide.
“European leaders should continue to focus on encouraging an active M&A market that fosters European champions who can compete effectively internationally,” added Cardi.
The view is similar in Portugal, which is pitching itself as the North and South Atlantic gateway to the European Union (EU). Rui de Oliveira Neves, a corporate and energy partner at Morais Leitão, said: “Trump could have a more transactional approach to the European partnerships, which would not necessarily represent less investment, but would require a more active engagement from Portuguese public and private entities to continue the growth path. Portugal’s main advantage could be precisely its geopolitical position in relation to Africa, Brazil, and the EU.”
Jessie Gaston, a Paris-based tax partner at Orrick Herrington & Sutcliffe, said multiple 2024 elections worldwide have caused markets to stall as investors wait for more clarity about the direction of policy and trade.
“I believe the American election, regardless of who won, coupled with the interest rate reductions we are seeing in Europe, will stimulate business activity that has been delayed or put on standby since the beginning of the year,” said Gaston. She added that Trump’s promised U.S. tax cuts contrast with tax increases that governments in Europe are imposing. That could “incentivize some high-performing companies to consider setting up shop in the U.S. We could then see a policy shift to keep these companies in Europe.”
Wouter Ghijsels, managing partner of Stibbe’s Brussels office, said his firm expects Trump’s election “will lead to increased demand for expertise in regulatory compliance to help our clients navigate regulations affecting cross-border transactions.”
A pressing matter for all of Europe is the war in Ukraine, with lawyers worrying that a Trump victory may mean the U.S. withdraws support as Ukraine struggles to fend off Russia’s aggressions.
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Gail J. Cohen, Alex D’Elia, Rick Mitchell, Christopher Niesche, Alfred Olufemi, Dario Sabaghi, Jessica Seah, Kasvi Sehgal, Peter Shaw-Smith and Linda A. Thompson contributed to this story.
From: International Law