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Temasek warns: Trump presidency could hamper global growth and impact markets

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Singapore’s Temasek, a major state-owned investment firm, is sounding the alarm about the potential economic repercussions of a Donald Trump victory in the upcoming U.S. presidential election.

A statement from Rohit Sipahimalani, Temasek’s chief investment officer, that was featured in a The Edge Malaysia report, states that a Trump administration could lead to slower global growth, ultimately affecting American businesses.

2025 outlook – not optimistic

While many investors are banking on a Trump presidency for lower taxes and deregulation, Sipahimalani cautioned that the long-term outlook through 2025 is far from optimistic. “The picture is not that clear,” he noted in a recent Bloomberg Television interview.

As global investors brace for the election outcome, the latest Bloomberg Markets Live Pulse survey indicates that Trump might favor stock and Bitcoin investors over his Democratic rival, Kamala Harris.

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However, Sipahimalani suggested a Harris victory would likely bolster emerging markets, contrasting the potential fallout from a Trump win, which he believes would strengthen the dollar, raise interest rates, and introduce uncertainty through tariffs—an environment detrimental to investments.

Temasek, which boasts a net portfolio value of S$389 billion (RM1.28 trillion), has recently shifted its strategy to invest heavily in the U.S., planning to allocate US$30 billion over the next five years.

Nevertheless, Sipahimalani warned that markets may face greater volatility in 2025 than they have in recent years, emphasizing that the risks of unexpected events—referred to as “tail risks”—are being underestimated.

Additionally, he discussed the complex situation in China, stressing that the effectiveness of fiscal stimulus will hinge more on implementation than on the sheer amount of spending.

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“The next year will be bumpy, and we should expect a more volatile trading market,” he concluded.

Temasek

Guided by its purpose, “So Every Generation Prospers,” Temasek aims to create a positive impact for both current and future generations. Operating on commercial principles, the company focuses on achieving sustainable long-term returns.

Temasek has 13 offices across 9 countries worldwide, including Beijing, Hanoi, Mumbai, Shanghai, Shenzhen, and Singapore in Asia, as well as Brussels, London, Mexico City, New York, Paris, San Francisco, and Washington, DC outside of Asia.

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