Trump tells businesses to make products in the US or pay the price
Donald Trump has told businesses they should make their products in the US, or face paying tariffs, while speaking at Davos.
President Trump addressed the World Economic Forum at the Swiss ski resort this afternoon, and used his speech to emphasise his message to business.
Speaking to delegates at the conference via video link, he said: “Come make your product in America and we will give you among the lowest taxes as any nation on earth.
“But if you don’t make your product in America, which is your prerogative, then very simply, you will have to pay a tariff – differing amounts – but a tariff, which will direct hundreds of billions of dollars and even trillions of dollars into our treasury to strengthen our economy and pay down debt under the Trump administration.”
As part of his wider pitch to businesses, Trump said that under his administration there would be “no better place on earth” to create jobs, build factories or run companies than “the good old USA”.
Economists have warned that tariffs tend to raise costs for consumers and firms in the country that sets them.
Analysis by AFH Wealth Management stated: “While importers pay the tariff itself, its impact on end-user prices will depend on factors such as exporters absorbing part of the cost, importers limiting price increases, or adjustments in exchange rates.”
And speaking at this year’s Davos event, Larry Summers, former US Treasury secretary, told attendees during a panel event that while “economists are famous for disagreeing on things”, they are likely to agree that bluntly applied tariffs are “not likely to be economically positive”.
Elsewhere in his speech, Trump reiterated that he wants NATO members to pay five per cent of GDP towards their own defence, and said his team had negotiated a ceasefire in the Israel-Gaza conflict before taking office.
On the Russia-Ukraine war, Trump described it as an “absolute killing field” and added: “Nobody’s seen anything like it since the Second World War.
“They are laying dead all over the fields and it’s a flat field… it’s time to end it.”
The President said Saudi Arabia should lower the price of oil, arguing it would bring about an end to the Russia-Ukraine war, in an apparent reference to Russia continuing to make money from oil sales, which could be restricted by increased supply from the Middle East.
“You gotta bring it down,” he said. “I’m surprised they didn’t do that before the election.”
Trump said the US total government spending was $1.5trn higher than was predicted to be when he left office, and that the inflation rate was too high.
“From the moment I took office I took rapid action,” he said.
The President outlined the measures he has taken since entering office, including his executive order to end Biden’s green new deal – which he called the “green new scam”, and described the past week as “historic” and a “revolution of common sense”.