The majority of British entrepreneurs believe the return of Donald Trump will be ‘good for business’ – even as his plans set alarm bells ringing in capitals across Europe.
A survey by Helm, a group of 400 UK start-ups with combined annual revenues of £8billion, found two-thirds are optimistic about their prospects under the new US President even as others worry about protectionist ‘American First’ trade policies.
And speaking to the Mail at the World Economic Forum in Davos, advertising guru and City grandee Sir Martin Sorrell said the return of Trump to the White House has put rocket-boosters under business confidence in the US.
‘America is on steroids, on fire,’ he said. ‘The animal spirits are at a level I haven’t seen since Reagan in 1985.’
His comments came before Trump addresses delegates in the Swiss ski resort by video link today, with many of the self-styled global elite listening in with trepidation.
But while the threat of tariffs and taxes on trade partners and foreign multinationals give some sleepless nights, others see an economic boom on the horizon.
Threats: Trump has stood firm on his ‘America First’ approach and has suggested he intends to hit the European Union with tariffs
‘If you said: “What are people talking about at Davos?”, it’s just one word: Trump,’ noted Sorrell, who is chief executive of marketing group S4 Capital.
New York Stock Exchange president Lynn Martin said companies are already actively ‘making plans’ to list their shares following his victory.
JP Morgan chief executive Jamie Dimon – dubbed the King of Wall Street and the most powerful banker on the planet – struck a more cautious tone, however, warning that share prices ‘are kind of inflated’.
He added: ‘You need fairly good outcomes to justify those prices, and we’re all hoping for that.
‘I think having pro-growth strategies helps make that happen, but there are negatives out there and they tend to surprise you.’
It is the negatives and the surprises that are causing alarm in European capitals, including London.
Joining Chancellor of the Exchequer Rachel Reeves in Davos, Business Secretary Jonathan Reynolds yesterday said: ‘It will be a choppy time to be a trade minister, there’s no doubt about that, but our job is to navigate through that.
‘You don’t get to pick the world as you want it to be, you get the world as it is.’
And that world is likely to see increased tariffs placed on some of America’s closest trading partners and even higher taxes on major foreign corporations operating in the US.
Trump has stood firm on his ‘America First’ approach and shortly after his inauguration this week declared: ‘The European Union is very, very bad to us so they’re going to be in for tariffs. It’s the only way… you’re going to get fairness.’
Reeves was rather more optimistic about the outcome than some of her European neighbours, noting a potential Brexit dividend.
Speech: President Trump addresses World Economic Forum delegates in the Swiss ski resort by video link – with many of the self-styled global elite listening in with trepidation
‘We’re not inside the European Union so a tariff on the EU will not affect the United Kingdom,’ the Chancellor said.
German leader Olaf Scholz and French president Emmanuel Macron were more circumspect as they held joint talks in Paris.
‘President Trump will be a challenge, that much is already clear,’ said Scholz.
Macron added: ‘It is necessary more than ever for Europeans and for our two countries to play their role of consolidating a united, strong and sovereign Europe.’
Spanish prime minister Pedro Sanchez joined the unease after he called to strengthen the transatlantic relationship and ‘avoid any misunderstanding’.
Sanchez added: ‘A trade war is not in the interest of the US and of course [not] in the interest of the European Union.’
And Larry Summers, a leading economist and former US treasury secretary, sounded a grave warning about Trump’s plans at a time when the West is threatened by an ‘axis of autocracy’ including Russia, China, North Korea and Iran.
‘If our strategy starts from alienating those who have been traditionally close to us, I wonder what the consequences of that strategy will be,’ Summers told a panel discussion at Davos.
King of Wall Street: JP Morgan chief Jamie Dimon warned that share prices ‘are kind of inflated’
British business leaders suggested the UK and Europe become more like America by following Trump with lower taxes and less red tape.
‘I think what London needs to be focused on is not Frankfurt or Paris – it needs to be focused on New York and Singapore,’ said the Barclays chief executive CS Venkatakrishnan.
‘The economic changes that are being proposed on regulation and the business-friendly attitudes are very optimistic.
‘I think the basic movement of the pendulum is a good one. And I would hope that movement of the pendulum towards a more balanced regulatory construct happens in Europe as well and in the UK.’
Luke Johnson, former Pizza Express boss and now chairman of Gail’s Bakery, said the contrast between the UK and Trump’s pro-business America ‘could not be more stark’.
Warning the UK faces recession as business is weighed down by £40billion of extra taxes and £5billion of extra costs from Labour’s reforms to rights in the workplace, he said: ‘There is a terrible contrast between our lot here, who are clearly not really understanding or in favour of growth or businesses, and America, which will certainly have a very interesting few years ahead because they will be able to attract the capital which will lead to growth.’
Britain’s entrepreneurs remain hopeful, however.
‘This bullish sentiment likely reflects Trump’s pro-business policies, which many entrepreneurs believe could provide opportunities for growth,’ said Helm chief executive Andreas Adamides.
DIY INVESTING PLATFORMS
AJ Bell
AJ Bell
Easy investing and ready-made portfolios
Hargreaves Lansdown
Hargreaves Lansdown
Free fund dealing and investment ideas
interactive investor
interactive investor
Flat-fee investing from £4.99 per month
Saxo
Saxo
Get £200 back in trading fees
Trading 212
Trading 212
Free dealing and no account fee
Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.
Compare the best investing account for you
Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.
