December 22, 2024

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Brian Ballard, president of the Washington lobbying firm Ballard Partners, speaks at The Korea Herald HIT Forum held at the Korea Chamber of Commerce and Industry in Seoul on Sept. 5. (Lee Sang-sub/The Korea Herald)

US President-elect Donald Trump is likely to use tariffs not only as a tool to protect American manufacturers but also as a way to ensure that trade negotiations are fair and expedited, a top Washington lobbyist says.

“Trump has several administrative avenues to implement tariffs and his suggestion of a 10 percent universal tariff on all imports is still a possibility,” Brian Ballard, president of the Washington lobbying firm Ballard Partners, told The Korea Herald in a written interview.

“Despite this, there will be exemptions to these duties, just like there were during his previous term in office. President Trump is likely going to follow a similar course and use tariffs as a first line of defense to protect American manufacturers while also negotiating trade deals that allow trade deficits to decrease and a fair arrangement to be established.”

Trump vowed on Monday to impose a 25 percent tariff on Canada and Mexico until the US neighbors clamp down on drugs, particularly fentanyl, and migrants crossing the border. He also announced an additional 10 percent tariff above any additional tariffs on all Chinese imports.

Noting the recent nomination of Howard Lutnick, chief of the brokerage and investment bank Cantor Fitzgerald, as Secretary of Commerce, Ballard explained that Lutnick will likely agree with Trump on “several” of the president-elect’s campaign pledges.

“Korean companies should keep an eye out for who will be nominated as President Trump’s US Trade Representative, and keep in mind that President Trump will have a wholehearted focus on ensuring the flourishing of American manufacturers as well as the decrease of the United States trade deficit,” said Ballard.

Regarding Trump’s repeated remarks about canceling the electric vehicle mandate and revising the Biden administration’s Inflation Reduction Act, Ballard underlined that Trump is most likely not going to remove the benefits for semiconductors, EVs and batteries made in America but will try to increase the pressure on companies that are propping up the Chinese chip, EV and battery industries.

“Korean companies in the semiconductor, automotive and battery industries who have invested in the US to create local jobs and contribute to the strengthening of the American manufacturing base are likely to be viewed as favorable by President Trump and will likely be in a stronger position to be granted trade exemptions,” he said.

As for Trump’s hardline stance on China, Ballard said the president-elect will likely keep his strong stance against Beijing’s economic influence while looking to negotiate a trade agreement with China as he did during his previous term.

“The chances of a new deal being agreed to is higher now that China’s economy has weakened since Trump’s last term,” he said. “If one does occur, it will likely provide clarity for Chinese material-reliant companies. Korean companies would likely benefit from increasing their resources spent on compliance, and government affairs, which could help advise them in their navigation of the upcoming standoff between China and the US.”

Ballard, who visited Korea for the first time in September to speak at The Korea Herald HIT Forum held at the Korea Chamber of Commerce and Industry in Seoul, mentioned that he has noticed more active lobbying activities from Korean companies in the US.

“I have seen several companies become more involved in the US lobbying landscape,” he said. “I think that Korean firms are in a unique position to share their concerns with Congress and the multitude of executive agencies that regulate international trade. South Korean firms are important stakeholders in many of the issues that are being tackled by the US government.”

Pointing out that Korean companies are taking advantage of the opportunities that lobbying firms offer to ensure their opinions are considered when US politicians make legislation or policies, Ballard advised Korean companies to look for a reliable government affairs partner that is “committed to understanding the problem facing the company and then being able to translate that understanding into effective advocacy.”

“I would suggest not focusing on the parties but instead on the issues,” he added. “Republicans and Democrats both will have to address the issues that Korean companies care about and good advocacy will be measured by how well your perspective on that issue is heard and understood by both parties.”

By Kan Hyeong-woo (hwkan@heraldcorp.com)