New President, New Policies: Trump’s Day 1 Executive Orders Reshaping Foreign Policy
Day 1 of Donald Trump’s second term has set the tone early for a foreign policy marked by decisive, controversial moves. With a flurry of Executive Orders (EO), he is charting a new course, signaling starkly different approaches to multilateralism, aid, and global cooperation.
There will be many more to come in the next few days, so I will be delivering updates on them as they are signed. Through them, we will see the outlines of U.S. foreign policy directions under his leadership.
Here are my quick takes on the first batch of EOs:
The Organization for Economic Co-operation and Development (OECD) Global Tax Deal (Global Tax Deal)
Why it matters
The Global Tax Deal is a framework of cooperation between 142 countries and jurisdictions representing 90% of global GDP to address corporate tax planning strategies that multinational enterprises use to exploit loopholes in tax rules to artificially shift profits to low or no-tax locations as a way to avoid paying tax.
The withdrawal from this framework is a signal of withdrawal from multilateral frameworks and a preference for bilateral engagements.
The withdrawal from an agreement that the previous administration championed and advocated for signals lack of consistency and longevity in U.S. foreign policy, reducing trust in American leadership on international multilateral issues.
Reduces U.S. input on global issues, as well as negotiating leverage in multilateral contexts.
Given the size of the U.S. economy, its withdrawal from the deal will have an impact on its implementation and structure, and will give other major actors, like China considerable say within its framework.
REEVALUATING AND REALIGNING UNITED STATES FOREIGN AID
Why it matters
The phrase that U.S. foreign aid serves to “destabilize word peace” is a strong statement by the incoming administration, lending credence to the notion that there was malicious intent behind aid programs.
This will impact USAID programs and their legitimacy and credibility in the future, even in case a Democratic administration succeeds the current one and resumes previous policies in the future, they may face problems in implementation.
The phrase “no further United States foreign assistance shall be disbursed in a manner that is not fully aligned with the foreign policy of the President of the United States” signals that the focus has shifted from broader policy goals to alignment with policies of the President. This incentivizes states seeking aid to engage directly with the president, due to the centralization of decision making on disbursement of foreign aid within the U.S..
The U.S. foreign aid program constitutes less than 1% of the federal annual budget and has been a pillar of U.S. foreign policy since 1961, building on the success of the Marshall Plan in post WWII Europe when the U.S. delivered significant financial and technical assistance to Europe after the war to stabilize the region.
The redesigned approach to aid will likely shift focus to different priority areas, and away from areas currently being supported. This will inevitably erode trust in the longevity of U.S. aid programs.
WITHDRAWING THE UNITED STATES FROM THE WORLD HEALTH ORGANIZATION (WHO)
Why it matters
Launched immediate accusations against the WHO, accusing the organization of demanding unfair payment from the U.S. (contributions to the WHO are assessed base on national GDP), and claiming that China pays 90% less (China contributes 15% of the budget and the U.S. contributes 22%) despite having a greater population. Population is not a metric of determining contributions however in the WHO.
This would be the second time in less than four years that the U.S. withdraws from the WHO, having withdrawn previously in July 2020 during President Trump’s first term, and then rejoined in January 2021 under former President Biden’s administration.
The withdrawal includes cessation of funding, recalling personnel connected with WHO, and identifying agencies and partners to engage with the U.S. on activities previously undertaken by the WHO.
Oscillating between membership and withdrawal denotes unstable and inconsistent U.S. foreign policy directives. It signals that American foreign policy longevity cannot be trusted beyond the term of any specific administration. This will disincentivize other states from effective long term engagement with the U.S., while incentivizing searches for alternative partners.
This is yet another indicator that the U.S. is disengaging from multilateralism.
This could reduce U.S. access to and involvement in collective efforts in global health issues, possibly exposing the U.S. health system to unnecessary risk due to disconnect from global health innovation and research networks, particularly in case of global health crises.
PUTTING AMERICA FIRST IN INTERNATIONAL ENVIRONMENTAL AGREEMENTS
Why it matters
After some explanations regarding perceived incompatibility between international agreements and initiatives in the field of environment and the growth of American economy, and the statement that the agreements misdirect U.S. taxpayer dollars to other countries, the EO states that the U.S. is withdrawing from Paris Agreement under the United Nations Framework Convention on Climate Change.
It also revoked the U.S. International Climate Finance Plan, and rescinds any national level plans involved in its advancement.
This marks the second time that the U.S. withdraws from the Paris Agreement, the previous time being in 2017 under Donald Trump’s first term, and rejoined the Agreement in February 2021 under President Biden.
Like the WHO oscillation, this signals two issues. The first being the inconsistency in U.S. foreign policy, hinging on varying positions between administration making it difficult to engage in long term agreements, and the second being further confirmation of U.S. withdrawal from multilateralism.
The withdrawal from the Paris agreements will disincentivize investment in clean energy in the U.S. and impact its long-term leadership on this trend on the global scale, ceding the scales to competitors.
With the growing trend toward sustainable technologies, demand for U.S. products incompatible with emerging needs may affect U.S. long term competitiveness.
Reduced focus on climate issues may reduce risk preparedness or climate-related security challenges.
The short-term gains from focusing on fossil fuels may not make up for the lost long-term potential.
These Day 1 executive orders reflect the implementation of Trump’s campaign promises, signaling a decisive shift in U.S. foreign policy. By deprioritizing multilateral cooperation in favor of unilateral actions and bilateral engagements, the administration is setting a tone of disregard for global consensus. This approach will undoubtedly redefine America's role on the world stage, creating ripple effects that will shape international alliances, global governance, and long-term U.S. influence in an interconnected world.