What would Trump presidency mean for Nepal?Could this result in removal of US preferential trade treatment for countries like Nepal, including reduction in development assistance that Washington provides through USAID and Millennium Corporation Challenge?
As a candidate, President-elect Donald Trump threatened to upend the international order by withdrawing from international trade agreements; by building wall on the border with Mexico to stop the flow of immigrants, while deporting millions of illegal migrants en masse; and slashing US financial commitment to security alliance in the Atlantic and Pacific, while forcing NATO members and Japan and Korea to pay more’ to maintain current US defense posture. This also suggests that a Trump Administration will be less keen to dole out the foreign aid to Least Developed and Developing Countries.
Will President-elect Trump walk the talk when he assumes office on January 20 next year?
If his acceptance speech was being looked at for clues, he gave away very little. It is unclear if the omission of his flagship foreign policy items was deliberate to look presidential-signaling to both his supporters and detractors both at home and abroad that he was prepared to rise to the occasion.
“I want to tell the world community that while we will always put America’s interests first we will deal fairly with everyone,” Trump told the crowd of supporters gathered outside his campaign headquarters in New York. “All people and all other nations. We will seek common ground not hostility, partnership not conflict.”
Given Washington’s limited strategic interest in Kathmandu, there may not be any immediate impact on US relations with Nepal but certainly there could be a trickledown effect on US-Nepal ties should Trump live up to his electoral promises of focusing on America’s problems while ignoring much of the rest of the world. This would mean that a Trump Administration would generally become inward looking, a trend that started in Europe with rightwing resurgence and culminated with UK’s Brexit vote on June 23-prior to Trump victory.
“If Trump pursues his stated foreign policies, it could have signification effect on the world order,” said Dinesh Bhattarai, former ambassador to the United Nations in Geneva and former foreign policy advisor to late PM Sushil Koirala.
US’s relative disengagement from global issues may also mean that countries with little strategic value may be put very low on US foreign policy priority. Nepal is already feeling the impact of similar right-wing surge in Europe. Denmark’s right-wing government decided to close it embassy in Nepal by the end of 2017 and is subsequently ending its development support.
So could this result in removal of US preferential trade treatment for countries like Nepal, including reduction in development assistance that Washington provides through USAID and Millennium Corporation Challenge?
“We are still working for President Obama and his administration. He serves as President until January 20, 2017. Until then, it wouldn’t be appropriate to speculate on the policy initiatives of the next administration,” said Ineke Stoneham, spokesperson at the US Embassy in Kathmandu, in an email statement.
The Obama Administration had earmarked $106.6 million for Nepal for this year. The $130 million that the US committed at the June 2015 donor conference for reconstruction has already been provided, according to embassy officials.
“It is necessary that we invest in our infrastructure, stop sending foreign aid to countries that hate us and use that money to rebuild our tunnels, roads, bridges and schools—and nobody can do that better than me,” said Trump in June.
Trump has proposed massive tax cut plan to reboot American economy. To finance his plan, Trump has proposed to cut 1 percent of all non-defence spending, including foreign aid “below previous year’s total each year,” according to the Center on Budget and Policy Priorities (CBPP), an American think tank that analyses the impact of federal and state government budget policies.
“While this may sound modest, the cumulative cut would be very substantial. By the tenth year (2026), non-defense appropriations would be about 29 percent below current levels, after accounting for inflation,” wrote Richard Kogan and David Reich, senior fellows at the CBPP, in September this year.
Riding on the Trump wave, the Republicans now control both houses of US Congress, which means there may be very little Congressional opposition to reducing non-defence budget, including foreign aid.