The coming into office of President Donald Trump provides an opportunity on how PESTLE affects the business spectrum.
- Political: The Democrats and the Republicans have always had perspectives that to some extent tend to fall on different ends of the spectrum; which in return affects the policies that are enacted. Not one to shy away from speaking his mind, POTUS has in numerous instances blasted policies by the Democrats (Obama and Biden) and vowed to repel some of them. National polices set the playground for businesses both at the Macro and micro level.
- Economic: The battle to offset the dollar’s supremacy has been raging with the BRICS nations being at the fore-front. The US dollar is the world’s reserve currency, a position that gives America geo-political advantage and a tight hold on global economy. President Donald Trump’s threat of 100% tariffs against attempts to ditch the green buck if implemented will affect the factors of demand and supply not only in America but with ripple effects felt in the global free market.
- Social: President Trump has promised sweeping action across key social issues that are at the heart of the American people. Factoring America’s position as a global power, the impact of these actions will be felt in countries far from the US. For example, Trump’s stand on the repulsion of Affordable Care has not changed since 2015. Statistics from previous editions of US Health Care paint a dire situation of America’s health system compared to her peers. Covid further exposed the tender under belly; costing 40times more loss on the nation’s gross domestic product than any disaster to have hit the US in the entire 21st century to date.
- Technology: One of the most visible aspect of President Trumps Inauguration ceremony was the presence of “Tech giants” executives at the ceremony. With the banning of Tik Tok in the American space coming into effect a day before; one of the actions upon assumption of office has been an executive order delaying the enforcement of the ban for 75 days as his administration gives ByteDance a window to “willingly” allow a hostile takeover of at least 50% of its controlling shares that President Trump believes is entitled to the US.
- Legal: President Roosevelt said “Remember, remember always, that all of us, you and I especially, are descendants from immigrants and revolutionists.” An echo to the narrative that the United States of America is built on the sweat of immigrants. Immigration ranked highly on President Trump’s manifesto as he begins his second term with a vow to put tighter restrictions not only on illegal immigrants but a review on the legal frameworks on immigration. For example, H-1B visa has been under scrutiny and changes to its parameters will greatly affect (negatively and or positively) the labour market.
- Environmental: President Trump has severally blasted his predecessor’s policies on cleaner energy and been very vocal in dubbing climate change a “hoax”. Just like in his first term, President Trump has again pulled the US out of the Paris Agreement and has threatened to target the Inflation Reduction Act (IRA) despite the US being the world’s 2nd emitter.
What this means for Africa?
Barely a week into office and the Trump administration has made decisions whose effects will be felt in the mother land. First is the speed at which he is moving at implementing his MAGA agenda, raising the question of why African leaders appear to be slow at implementation of policies and keep on asking for more time thus clinging onto decades of power.
Despite being a founding member of the WHO, America has exited the global health space and with it her financial backing as the biggest sole donor. With Africa being the biggest beneficiary of WHO’s budget, the African Union needs to marshal its members to the implementation of the Abuja declaration of 2001 and their recommitment in 2023 – where member states committed to allocating 15% of their government budgets to health care financing.
With the 90 days initial temporary suspension on US foreign assistance programs, a huge blow has been dealt that will mostly affect programs across agriculture, health, education and food security. In Kenya for example, Aid Data Network estimates a withdrawal of approximately $1.68 billion from the economy.
World Bank data estimated remittances from African in diaspora (2023) at $90billion, which is double the amount of foreign direct investment. In his first term as president, Trump supported the RAISE ACT that aimed at reducing the number of green card holders by approximately 50%. If implemented, a reduction of green card numbers will automatically be replicated in remittances from the US.
Reports from the World Meteorological Organization indicate that Africa seems to be warming up at a slightly faster rate (+0.4C) compared to the global average at about +0.3 C thus bearing an increasingly heavy burden that result in disproportional high costs for climate adaptation. Withdrawal from the Paris Agreement has impacted America’s contribution to the purse standing at approximately $11billion annually.
In conclusion, as more drastic measures continue being availed, Africa needs to adopt prioritization of her interest and self-dependence. While Trump did not visit Africa in his 1st term, left empty ambassadorial posts in some African countries and even referred to us as “shithole countries”; it is yet to be seen if he will rise above his personal feelings for the sake of America – factoring in the scramble for Africa has again been revived and BRICS gaining more ground in the continent against the G7. A good pointer to this “nation vs. self” is the invitation of China’s president to his inauguration despite a “hostile competitive” relationship between the two countries. The G20 summit 2025 will also be held on African soil, with the US forming part of the troika together with South Africa and Brazil, it will be interesting to see if he will skip the Johannesburg visit.
Christine Osicho
Managing Director
E-njil Consultancy
