Navigating uncertainty: The impact of the 2024 US elections on emerging markets

Emerging markets (EMs) have been significantly impacted by elections in countries like Mexico, South Africa, and India, but the upcoming US election is expected to have the broadest and most consequential effects on EMs. The potential return of Donald Trump, particularly with a Republican-controlled Congress, could lead to a resurgence of protectionist and isolationist policies, which may harm free trade and international cooperation, posing risks to long-term growth in EMs.

In contrast, a Kamala Harris victory would likely maintain the current policy trajectory. The paper outlines four potential election outcomes—Trump with a Republican or divided Congress, and Harris with a Democratic or divided Congress—highlighting the uncertainty in predicting specific policy impacts but offering insights into the implications for US trade, foreign, and domestic policy, particularly in extreme scenarios.