Challenges and Opportunities in US tariff implementation says Finance Minister

Tariffs being implemented by President of the United States of America (USA), Donald Trump have the potential to affect St Vincent and the Grenadines (SVG) negatively, but can also benefit the country.

Minister of Finance Camillo Gonsalves thinks there are both challenges and opportunities for countries like SVG when it comes to some of the tariffs that the US president has been talking about.

“If somebody is not trading X with the United States of America, doesn’t mean that that country or that product ceases to exist. It means that a new market will develop somewhere else for that product, either internally or in another country.

“…so, what we have to do is remain abreast of what the fallout of some of these policy declarations are in the real sense, and to try to take advantage of whatever opportunities present themselves,” the finance minister said at an Invest SVG event last week Thursday, February 6, 2025 at the Holiday Inn Express and Suites in Diamond.

Gonsalves said he is certain that opportunities will present themselves as when one door is closed, many doors are opened.

“We always have to not just say, ‘oh my God, look at what’s happening to the traditional way of doing business, or the traditional markets, or my traditional status quo expectations’ but we have to look at what new opportunities are created when and if a door is closed.”

Gonsalves added that the world is watching President Trump’s declarations with interest and even if they do not all come to fruition, they represent a new world view from the USA and a new desire to engage with the world differently, both diplomatically, from a trade perspective, and from a perspective of long held understandings about global cooperation.

“Whether it’s Foreign Direct Investment, whether that is international aid, whether that is meeting your climate responsibilities, whether it is meeting your humanitarian objectives, or whether it is obeying global rules for trade- all of them are under, at least under verbal threat at the moment, and many of them will be under actual threat, but we think that what we need to do in St Vincent and the Grenadines is be nimble, be observant, and be ready to take advantage of whatever opportunities present themselves from these changes.”

Gonsalves noted that during the November, 2024 Presidential elections in the USA, Trump pledged to be a disruptive force and ran on a platform of being a disruptor and a change agent, and he has been trying to fulfil some of his campaign promises.

“As a politician, I admire anybody who tries to fulfil their campaign promises…to date many of his threatened actions have not yet been tangibly felt in our region, and many of his original proclamations about tariffs and the like, he’s walked them back.

“He had made some pledges about immediate tariffs on Canada, some immediate tariffs on Mexico. He’s walked those threats back, at least in the short term, for various reasons that we don’t need to get into now,” the finance minister pointed out.

“So, sometimes it’s not immediately what is said, but what is done, and not as much has been done as has been said at this particular point in time.” Gonsalves also noted that we have to keep our eye on the ball in that regard.

“Nonetheless, he signalled an intent to retreat or to abandon many of the traditional pillars of global cooperation and global trade. Diplomatically, he signalled that he’s going to withdraw or disregard a number of the principal bodies that foster global cooperation- United Nations, World Health Organization, the UN conference on climate change and the like, the World Trade Organization- and he has signalled that he has a world view that is more aligned with President McKinley of many years ago, when the world was a place where you built walls around yourself and erected tariff walls and engaged in trade wars,” Gonsalves further noted.

“Time will tell whether or not that world view translates to modern global transactions. However, whatever happens, there are both challenges and opportunities.”