Crypto News: Supply Lines: Worries in Asia

Donald Trump says "tariff" is his favorite word, campaigning on a bet that steep import taxes will force manufacturers to move factories to the US.

The former president has also criticized the Inflation Reduction Act as a "scam" and the CHIPS and Science Act as a bad deal.

That's created angst among the giant Asian firms that have already announced US investments as they worry a second Trump administration would impose tariffs and also rip up the Biden administration's tax breaks and subsidies that helped lure them. (Click here to read today's full story.)

US Election: Follow our coverage of the US presidential race here.

More than $110 billion in new greenfield investments into the US has been announced in each year since 2021, according to data from the UN Conference on Trade and Development.

Leading the charge are the economies of East Asia, with a combined $147 billion from Japan, South Korea and Taiwan over those three years. Companies such as Toyota, Hyundai Motor, TSMC and Samsung Electronics are adding to their US footprint to take advantage of the strong economy and cash in on Biden's industrial incentives.

Now, uncertainty surrounding the election is hanging over those plans.

"Trump is a master of unpredictability" and abrupt actions are likely if he takes office, said Bill Reinsch, a senior adviser at the Center for Strategic and International Studies, a Washington-based think tank.

Big Take: US Efforts to Contain Xi's Push for Tech Supremacy Are Faltering

The Biden administration's IRA offers tax credits and other incentives for the production of electric vehicles, renewable energy, sustainable aviation fuel and hydrogen. Trump described the policy as the "Green New Scam" in a recent Bloomberg interview.

Meantime, the CHIPS and Science Act of 2022 offers incentives to bring more advanced semiconductor manufacturing to US shores. In a recent interview with Joe Rogan, Trump said the "chip deal is so bad" arguing that applying hefty tariffs would be a better way of forcing companies to set up factories in the US.

Targets for Repeal

Multiple electric vehicle-related provisions could be key targets for repeal if Trump wins, especially if Republicans take both houses of Congress, BNEF analyst Corey Cantor wrote in a report on the Bloomberg Terminal this week.

South Korea's Finance Minister said last week that he expected strong ties with the US and investment to continue no matter who wins on Nov. 5. Companies, by contrast, expect greater trade barriers and geopolitical tensions, with about two-thirds of manufacturers surveyed by the Korea Chamber of Commerce and Industry saying they expect trade protectionism to intensify next year.

According to a government-affiliated think tank, South Korea's economy would likely suffer a contraction if Trump returns to the White House and ratchets up tariffs against trading partners.

So until there's clarity on what America's industrial and trade policy is going to look like, firms may hold off on delivering on their investment plans or making new ones.

Related Reading:

—Bloomberg News in Beijing

Click here for more of Bloomberg.com's most-read stories about trade, supply chains and shipping.

Picking up speed | Mexico's economic growth accelerated more than expected in the third quarter on solid domestic demand and a recovery of the agriculture sector, marking a pace that's unlikely to be sustained going forward. GDP expanded 1% in the three months through September, above the 0.65% median estimate of economists surveyed by Bloomberg.

The European Union has decided to send officials to Beijing to hold more talks aimed at finding an alternative to tariffs on electric vehicles from China. Meanwhile, Chinese EV makers lost ground in Europe for a third straight month, and Stellantis shipped fewer cars from factories in most of its major markets.
Companies seem to be holding their collective breath for the outcome of an election that will define global commerce for at least the next four years. Bloomberg's Trade Tracker showed three out of 10 key measures of international trade in "below normal" territory, the most in five months, while six were in the "normal" zone.
Boeing will not attend China's top commercial and defense airshow next month, a notable absence by the airplane maker in a key export market. Meanwhile, Airbus will replace the head of its commercial aircraft business and stick with a goal to deliver about 770 aircraft this year.
Rising protectionism globally and a deeper trade war with the US may give China the much-needed push to bolster domestic consumption, said Weijian Shan, who chairs one of Asia's largest alternative asset managers.
Hong Kong's economy slowed to the weakest pace in five quarters on weakened exports and spending.
In this Talking Transports podcast, Harman Cheema, Cheema Freightlines' CEO, shares insights about the state of trucking market from his perspective as a midsize carrier operating in the western US.

Bloomberg Supply Chain Intelligence Webinar Series: Artificial intelligence technology has been with us for decades, but the recent release of ChatGPT and other LLMs have transformed how we use and view AI at work and at home. Is AI ready to be deployed in supply chain management and what do I need to know about this powerful technology? Join us on Nov. 6 when host Matthew Ekroth sits down with Risto Miikkulainen, VP of AI Research at Cognizant AI Labs, for a fireside chat on this important topic. Click here to register.

Maersk expects disruptions to global trade from the Red Sea conflict to last well into next year, according to its CEO.
Cosco's net income spiked in the third quarter, primarily due to higher container-freight rates against last year's lower comparison. Bloomberg Intelligence says "the outlook for 2025 is less upbeat with spot rates continuing to retreat since July."
Run SPLC after an equity ticker on Bloomberg to show critical data about a company's suppliers, customers and peers.
Use the AHOY function to track global commodities trade flows.
See DSET CHOKE for a dataset to monitor shipping chokepoints.
For freight dashboards, see {BI RAIL}, {BI TRCK} and {BI SHIP} and {BI 3PLS}
Click HERE for automated stories about supply chains.
On the Bloomberg Terminal, type NH FWV for FreightWaves content.
See BNEF for BloombergNEF's analysis of clean energy, advanced transport, digital industry, innovative materials, and commodities.

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