How the 2024 USA elections could shape Australia’s M&A landscape

As we consider the potential impact of another Trump presidency on the Mergers and Acquisitions (M&A) landscape, it’s impossible to ignore the spillover impact that Trump’s regulatory and economic policies can have on Australia. With his return to the White House, we can anticipate a wave of both opportunities and challenges for the Australian M&A sector. Here are our predictions of what can happen over the next four years under Trump’s administration. 

Election certainty is our ally

About one-third of all the countries in the world have had an election this year, with the largest and most anticipated being the US elections in November 2024. With the results of the elections behind us, the gates have opened wide for CEOs and PE firms to close more deals in 2025, seeing a rise in M&A activity as pent-up demand finds its way into the market. What this means for Australia is more clarity with fewer unknowns as well as more cross-border opportunities with US firms looking beyond their borders to expand geographical footprint.  

Inflationary pressures

Despite a 15,000-kilometre distance between Sydney and Washington DC, the economic impact of Trump’s anticipated policies will undoubtedly be felt here. With Trump making headlines on his plans to introduce tariffs globally and particularly on China, the consensus is this will put upward pressure on inflation and ultimately interest rates. Should a trade war erupt between the US and China, this may trigger growing political tensions between the two countries.  

So, how would this matter for Australia? Our goods and services are a relatively small market for the US so the impact of a potential trade war will mainly be felt indirectly. A growth slowdown in China and other Asian trading partners could potentially reduce the demand for Australian commodities. While China is a significant trade partner and a source of M&A investment in Australia, the disruption in their economy may reduce their interest in foreign investment as well as the appetite for regulators like FIRB to approve Chinese M&A investment in Australia.  

Impacts of imposing tariffs

Trump’s tariffs, designed to protect US industries, will have consequences. This means that the cost of goods will go up and put pressure on higher interest rates. While this may strengthen the US dollar, it may cause the Australian dollar to depreciate. Having a weaker AUD might boost export competitiveness but it could also raise import costs, adding inflationary pressure and tightening margins for local businesses. However, the flip side is that Australia’s reputation as a low sovereign risk destination may attract increased foreign investment. Our steady economic environment could make Australian assets more appealing, driving cross-border M&A interest, particularly from US firms seeking stable opportunities.  

The bottom line

The 2024 USA elections and Trump’s upcoming term bring both challenges and opportunities for Australia’s M&A landscape. While concerns about the impacts of tariffs and inflationary pressures are on the radar for the RBA, Australia’s economic resilience remains a key strength. If you’re navigating your own M&A transaction – whether locally or cross-border – the InterFinancial team has the strategic expertise to guide you at every step of the process. A part of the wider Clairfield network with a presence in over 32 locations, we offer a global reach with local expertise. Contact us today for more information.