Trump and Haley: Foreign Policy

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Executive Summary

  • Donald Trump and Nikki Haley share similar foreign policy aims. Their muscular brands of foreign policy, combined with simmering conflicts around the world, will lead to continued growth in the defense sector and an uncertain outlook for global shipping and energy.
  • Foreign trade policy marks the major point of contrast, with Trump preferring a tariff-heavy “managed trade” approach and Haley advocating for policies more grounded in free market principles. A Trump victory will be a boon to traditional industrial sectors while increasing costs for imports of US consumer staples.  
  • Regardless of who ascends to the Oval Office, the convergence of foreign policy crises in regions across the globe will continue to wreak havoc and stretch American capabilities.

Introduction: A Simmering World 

Despite Trump’s victories on Super Tuesday and Haley dropping out, we continue our series on the Republican candidates with a deep dive into foreign policy. We feel it’s critical to understand where both stand on geopolitics as this topic is #1 in most investors and CEO’s minds when it comes to 2024 risk. Wherever you look, the world seems to be ablaze. Israel and Gaza. Russia and Ukraine. China and Taiwan. The dizzying array of flashpoints increases the complexity of foreign policy choices facing the next president.

Anxieties over the impact of foreign policy developments are bleeding over into the US electorate. This time last year, just 18% of Americans listed foreign policy as a top issue in a poll conducted for the Associated Press. Today, that percentage has doubled. Yet as geopolitical risk firm Eurasia Group bluntly pointed out, the future is all the more uncertain when “the United States, the world’s sole remaining superpower, doesn’t want to be the world’s policeman, the architect of global trade, or the cheerleader of global values.”

With shifting dynamics in global power structures, the need for astute foreign policy leadership has never been more pressing. The complexities of international relations demand careful consideration and strategic decision-making, particularly in the face of escalating tensions in key regions.

Enter Trump and Haley. When it comes to foreign policy, both share a clear commitment to beefing up America’s military. They call out threats from China, Iran, and North Korea in unison. Much of their foreign policy agenda is aligned – perhaps a natural consequence of their shared mission when Haley served as Trump’s Ambassador to the United Nations. Nonetheless, there are key differences, particularly with respect to international trade and the overall posture towards Russia. Their slight policy differences are magnified by their competing diplomatic styles. Trump is willing to vocally criticize allies in public, a fact laid bare by his recent comments concerning defense spending by NATO members.

This article will uncover the nuances behind the Trump and Haley positions, while pointing investors towards relevant market opportunities. We will begin, as always, with a brief overview of the candidates’ positions.

Donald Trump

The former president promises a foreign policy approach that intensifies the key themes he pursued during his first term. Trump is often described as a foreign policy isolationist due to his narrow view of US interests and antipathy towards multilateral institutions. Perhaps a more apt label would be an American foreign policy deal seeker. Trump does not envision an America that retreats from world affairs, but he prizes the idea that America can tackle any foreign policy challenge alone. His chief concern is striking pragmatic deals that promote US economic interests. He is far less interested in promoting “American values” or coalition-based diplomacy on the world stage. Trump also believes his unique deal-making ability can transcend some of the most vexing political predicaments, including an expansion-minded Russia and a nuclear-armed North Korea.

Trump’s major foreign policy priorities are to win the global competition with China, improve America’s trade relationships, and project military strength across the globe. China occupies the central role in Trump’s foreign policy worldview. His actions on trade – including a proposal to impose a 60% tariff on all Chinese imports – reflect his desire to overhaul the status quo with China.

Trump also supports a foreign policy that is based on US military might. He is a vocal supporter of defense spending and often complains that the US carries too much of the burden for global security. His recent comments blasting NATO allies are just the latest in a long-running Trump critique of the foreign policy landscape.

Finally, Trump is a strong supporter of Israel. During his time in office, he moved the US Embassy in Israel to Jerusalem, recognized the contested Golan Heights as Israeli territory, and launched the Abraham Accords to help normalize relations between Israel and the Arab world.

Nikki Haley

Haley leans heavily on her time as U.S. Ambassador to the UN to burnish her foreign policy credentials. She shares Trump’s zeal for “getting tough” on China, Iran, and other adversaries (although Haley is a more vocal critic of Russia than the former president). Like Trump, Haley is supportive of using US military and economic power to take aggressive action. However, Haley demonstrates more willingness to partner with allies, build coalitions, and conduct international affairs according to established diplomatic protocols. For example, responding to Trump’s recent criticism of defense spending by NATO allies, Haley said “I will absolutely put the hammer on our NATO countries that [do not carry their weight], but you do that behind closed doors.”

Haley’s diplomatic finesse and emphasis on collaborative approaches have earned her praise for her ability to navigate complex international relationships while upholding American interests. Her approach contrasts with Trump’s more unilateralist tendencies and highlights the importance of multilateral engagement in addressing global challenges.

Strategic competition with China is a major priority of Haley’s foreign policy agenda. Haley frequently blasts Beijing for environmental and human rights abuses. She has also called for policies that would dent China’s manufacturing prowess. Nonetheless, she stops well short of Trump’s preferred approach to economic warfare. Haley is not keen on imposing stiff tariffs to achieve her foreign policy aims, calling Trump’s 60% tariff plan “ludicrous.” Over the course of the campaign, Haley repeatedly tried to accentuate her viewpoint on foreign trade to draw a clearer contrast with Trump.

Her stance on trade reflects a more nuanced understanding of economic interdependence and the potential risks of aggressive protectionist measures.

Finally, Haley is a major advocate for Israel. She has voiced steadfast support for Israel’s military operations in Gaza and lays the blame for the current situation entirely on Hamas. This perspective also dovetails with her vigorous criticism of Iran and Iranian proxies in the Middle East.


Given global security realities, Trump and Haley are both likely to keep demonstrating America’s military might. Investors can expect either to find creative avenues for containing China, supporting Israel, and pressuring Iran and Iranian proxies. In turn, these actions will provide fodder for growth in the defense and national security sector, while clouding the outlook for global shipping and energy.

The foreign policy decisions of both Trump and Haley are poised to have significant implications across various sectors, shaping investment landscapes and economic trajectories on a global scale.

Start with the continued growth and expansion in the defense and national security sector. With serious threats bubbling around the world, and several others lurking just below the surface, defense spending is surging. This trend largely benefits the US, which is a major supplier of arms and advanced weapons systems. Trump’s threatening posture towards NATO allies who fail to invest in their military is also likely to keep European defense spending elevated.

Even before Trump’s admonishing comments, NATO allies were already ramping up their defense spending. In 2023, NATO countries collectively increased spending levels by 11% compared with 2022. Defense companies and arms manufacturers in the US, UK, and other NATO nations will continue to reap the benefits of surging demand. American defense companies have proved particularly successful, inking $81 billion in new foreign military sales last year – an increase of more than 50 percent from 2022.

The growing demand for defense and security solutions highlights the need for continuous innovation and technological advancement to address evolving global threats.

The demand surge seems set to continue in 2024. Just this week, British defense firm BAE Systems reported a record order backlog worth nearly 70 billion British pounds. Ukraine also secured more aid from Germany and France, even as a US military aid package for the embattled Ukrainian army languishes in Congress. Meanwhile, Israel’s continuing military operations and a menacing China in the Strait of Taiwan will drive demand for weapons and ammunition in the Middle East and Asia-Pacific.

The second major trend driven by the likely policy choices of Trump and Haley concerns the outlook for global shipping and energy. Both sectors are critical arteries for the smooth functioning of the global economy. They also remain highly sensitive to the array of global conflicts. With Trump and Haley intent on maintaining an aggressive global posture, the risk of further escalation increases. Unlike the growth of the defense sector, this trend poses negative economic side effects by increasing costs for firms and consumers. US consumers, who buy imported products in droves, are particularly sensitive to inflationary pressures in shipping and energy.

The heightened geopolitical tensions fostered by Trump and Haley’s policies could result in disruptions to global supply chains and increased costs for businesses and consumers, ultimately dampening economic growth.

American foreign policy adversaries are already making their presence felt in shipping. Attacks against commercial shipping lines launched by the Houthi rebels in Yemen have forced the rerouting of vessels, costing time and money. According to the Associated Press, at least 90% of the container ships that had been going through the Suez Canal are now rerouting around the tip of Africa. Prices for shipping a standard 40-foot container have doubled or tripled for many logistics providers since the Houthis began their strikes.

The outlook for global energy markets, particularly oil and natural gas, will also continue to be clouded by geopolitical risk under a Republican presidency. The same factors driving increased costs in shipping apply to energy. Consider that crude oil prices rose about 4% following the initial U.S.-led airstrikes on the Houthis – a clear sign that markets anticipate turbulence as the tit-for-tat strikes continue.

For now, these pressures have not erupted into a serious oil supply shock. But escalation from any one of the conflicts in the Middle East could blow the lid off oil prices. Imagine if Israel, supported by the US, launches a more sustained campaign against Hezbollah in Lebanon that leads to a spiraling regional conflict. More aggressive sanctions on Iran implemented by Trump or Haley could have a similar effect. Investors should be wary of the foreign policy headwinds festering in oil markets. 

The outlook for natural gas paints a similarly uncertain picture. Russia’s natural gas exports to Germany and other key European buyers started dwindling after the onset of violence in Ukraine. Russia has now halted them altogether. Mild temperatures have eased pressure on gas supplies, but many European nations remain just one bad winter away from a natural gas crisis. The loss of a cheap, reliable energy source has also battered European manufacturing, particularly in Germany, where over half of the nation’s gas supply came from Russia. With the war in Ukraine entering its third year, the prospects for ending Russia’s economic isolation seem remote. The near-term outlook for natural gas supplies will therefore remain fragile, especially given President Biden’s pause on new liquified natural gas export projects in the US. The ongoing geopolitical tensions, coupled with uncertainty surrounding energy supplies, highlight the need for strategic energy policies and investment in alternative energy sources.

Trump has taken a softer tone against Russia and even praised Russian President Vladimir Putin. He has also taken a much more muted approach to the war in Ukraine compared to Haley. Nonetheless, it is difficult to envision a scenario where a Trump-led rapprochement with Russia bears fruit. Even if Trump is more willing to entertain a formal partition of Ukraine, a breakthrough that unlocks Russia’s natural gas supplies for Europe seems unlikely. The differing approaches of Trump and Haley towards Russia underscore the complexities of diplomatic relations and the challenges of achieving meaningful resolutions in volatile regions.

Another area of divergence between Trump and Haley relates to foreign trade policy. Trump prefers a managed trade approach, where high tariffs are used to protect strategic industrial sectors and serve as leverage to negotiate bilateral deals. Haley promotes a more classical Republican free trade philosophy, trusting in the markets and actively looking for ways to empower US exporters on the global stage. We explored the nuances of trade policy in greater detail in a previous article, but the topic deserves mention here given the significant foreign policy implications.

The differing trade policy approaches of Trump and Haley reflect broader ideological differences within the Republican Party and have profound implications for global economic relations and diplomatic dynamics.  

Trump’s recent proposal to implement 60% tariffs on all imports from China would be a particularly stringent measure. If pursued, the policy would amount to a tax on all goods coming from China. Based on 2023 import figures, a diverse mix of consumer staples would be impacted. The top four categories of goods imported from China last year were electronics, machinery, toys and games, and furniture. In addition to product manufacturers, American retailers would also feel the pinch from increased costs at the border. The imposition of such tariffs could trigger significant disruptions in global supply chains and escalate trade tensions between the world’s two largest economies.

The likely winners under Trump’s foreign trade policy plan would be his preferred industrial sectors, like steel manufacturing and automobiles. Trump is intent on using all the tools at his disposal to provide American industrial firms with an advantage. Trump’s protectionist trade policies aim to bolster domestic industries but could provoke retaliatory measures and trade conflicts, impacting global trade dynamics.

The Haley plan would avoid major new tariffs and employ more subtle tactics for economic warfare. Haley shares Trump’s goal of leveling the playing field for American firms vis-a-vis China, but she criticized the tariff approach for ultimately backfiring on American consumers. Haley is also less concerned about protecting established domestic industries. On the campaign trail, she has been fond of sharing anecdotes about efforts to revitalize manufacturing in South Carolina – not by protecting incumbent textile manufacturers, but by reskilling workers and repurposing manufacturing assets for new industries. Haley’s advocacy for a more moderate approach to trade aims to balance economic competitiveness with consumer interests and long-term economic sustainability.


Donald Trump and Nikki Haley present similar foreign policy goals centered around muscular approaches to international relations. While their alignment on key issues such as China, Iran, and military strength is apparent, their differing stances on trade policy highlight a significant contrast between the two. Trump advocates for a managed trade approach characterized by high tariffs, whereas Haley leans towards a more free-market-oriented strategy.

Haley will not get an opportunity to make the case for her own brand of conservative foreign policy in the general election. The Trump victory leaves the Republican Party with a candidate fiercely committed to managed trade and a softer outlook on Russia. The overall outlook for US foreign policy seems set for escalating tensions. As conflicts rage, defense and national security spending will continue to boom, benefitting US firms. Yet at the same time, inflationary pressures in shipping and energy portend headwinds that could easily spiral out of control. The convergence of foreign policy pressures in several regions, from the Strait of Taiwan to the Strait of Hormuz, will stretch US capabilities and political will.

The convergence of global conflicts and tensions promises to shape US foreign policy in the coming years. With continued growth expected in the defense sector and uncertainty looming over global shipping and energy markets, investors must navigate a landscape fraught with geopolitical risks. As conflicts persist and challenges intensify, the next president will face difficult decisions that will reverberate across the global economy. The ramifications of their foreign policy choices will undoubtedly influence diplomatic dynamics, economic trajectories, and the security landscape on a global scale.


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I'm Andy Busch

If things feel crazy in the world today, that's because they are. We are seeing huge shifts in risk and reward, leading to a lot of economic uncertainty and confusion about where we go from here.

As an economic futurist, I do things a bit differently than your typical economist — going beyond analyzing how today's financial policies impact economic growth, to focus on the super-charged trends driving much of today's global chaos and change.

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