President-elect Donald Trump’s anticipated tariff hikes, alongside rollbacks of Biden administration industrial programs, are likely to create new obstacles for local business and challenge Georgia’s bid to further internationalize its economy.
Trade duties are at the top of the list for the new administration. Trump has said his first executive orders would include aggressive new levies on imports from Mexico, Canada and China, Georgia’s biggest trade partners.
Credit: FanYongheng
Credit: FanYongheng
The Trump administration also will likely seek to unravel President Joe Biden’s signature legislation: the Inflation Reduction Act, which authorizes nearly $400 billion in clean energy tax breaks and funding, directly affecting Georgia’s emerging solar and electric vehicle businesses.
Home Depot, Georgia’s leading public company, and Hyundai Motor Group, which is building a $7.6 billion electric vehicle plant in Bryan County, are in the crosshairs. Rivian Automotive, which is slated to receive nearly $6 billion in conditional federal loans to restart construction of its plant east of Atlanta, might see attempts to halt its funding.
Georgia firms have started taking action, redeploying their supply chains and ramping up imports ahead of the planned tariff hikes. Companies also are lobbying for modest duty increases and exemptions, or carve-outs, for their own firms or sectors.
But more needs to be done. Georgia business must now communicate loudly and effectively, in the public square and with elected leaders, about the importance of foreign trade and investment for jobs and the economic health of local communities. Overseas companies cannot afford to remain silent either.
The Peach State economy has increasingly internationalized over the last decade, with farmers exporting more poultry and cotton overseas, even as global automakers and aerospace manufacturers move to set up shop here.
Global trade has skyrocketed. Total overseas trade amounted to a record $186.76 billion last year, with exports of $49.9 billion, according to the Georgia Department of Economic Development. The state’s three biggest export markets were Canada, Mexico and China, which collectively accounted for $16.7 billion, or one-third of the total.
Foreign direct investment also is powering a bigger share of the state’s economy. For the fiscal year ended June 30, foreign direct investment in Georgia amounted to $5.94 billion, or 29% of all investment tracked by the Georgia Department of Economic Development. These projects are slated to create 8,105 jobs. South Korea alone was responsible for 20 projects, accounting for more than $3.1 billion in direct investment.
For Georgia business, the aggressive tariffs proposed by Trump now pose the biggest headache, particularly price hikes on Chinese goods. China remains the state’s leading trading partner, with imports of $17.5 billion in 2023. Trump promised during the campaign to raise tariffs on Chinese imports to 60%. Fifty economists polled by Reuters News expected tariffs to jump 38% next year.
“There certainly will be an impact,” Ted Decker, Home Depot’s chief executive, told analysts recently. The National Retail Federation calculated that a 10% rise in universal tariffs with a targeted 60% tariff on Chinese goods would lead to more expensive apparel, toys and household appliances for consumers.
But tariffs aren’t the only worry. Trump’s promise to “rescind” all unspent Inflation Reduction Act funding and his attacks on the CHIPS and Science Act present a separate challenge, particularly for the state’s ongoing drive to make e-mobility and clean energy central to the local economy. Scott Bessent, Trump’s pick for Treasury secretary, has called the Inflation Reduction Act a “doomsday machine for the budget.”
Among the projects that benefit from federal support is Rivian Automotive, which is slated to employ 7,500 workers and produce 400,000 vehicles by 2032. In August, Seoul-based QCells’ integrated solar manufacturing project in Cartersville secured a $1.45 billion loan guarantee, leading to 6,755 direct and indirect jobs.
South Korea’s Absolics, a SK Group unit, also received approval this year for government investment of $75 million to build a $300 million plant for semiconductor packaging in Covington, producing 200 manufacturing and research and development jobs.
U.S. House Speaker Mike Johnson, R-La., has talked of revoking the Rivian loan. Trump also said he would “rescind all unspent funds” from the Inflation Reduction Act and halt the $7,500 consumer tax credit for electric vehicle buyers provided in the act. That may impact demand from Hyundai Motor Group’s Metaplant America, Georgia’s biggest-ever investment project, which is receiving $2.1 billion in state and local tax breaks and incentives.
In the first Trump administration, Georgia companies managed tariffs by pushing costs up their supply chains and lobbying for exemptions. Washington provided help for lost trade, with Georgia farmers receiving an average $42,500 in tariff relief. This time, the costs could be greater.
Higher tariffs on Mexican-made car parts, for example, increase not only the price of new automobiles but also car repairs on Piedmont Circle. “If we get tariffs, we will pass those tariff costs back to the consumer,” AutoZone CEO Philip Daniele explained earlier this year. The industrial policy, tax breaks and incentives that are transforming Georgia’s economy also must be acknowledged.
That makes it critical for Georgia companies and business leaders to talk plainly and directly about the importance of global trade and investment to the Peach State economy. A simple playbook starts with mobilizing local business chambers and community groups to stress what’s at stake for Georgia: investment and jobs. Core messaging and communications with media, influencers and elected officials in county, state and federal governments must be improved. That might provide a bigger opening for business leaders to work more effectively with the Trump administration, ensuring Georgia’s economic interests are incorporated in Trump administration planning.
For Georgia to remain Open for Business, Georgia’s companies must safeguard business and secure the state’s strengthening relationship with international markets.
Matthew Miller is a senior adviser at the Foote Group, a strategic communications firm advising U.S. and Chinese multinational corporations on cross-border issues. He earlier worked as an Asia-based international journalist for nearly two decades.
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