The shipping industry’s fear is that US president-elect Donald Trump’s protectionist and isolationist views will ignite trade wars, depress global economic growth and curtail shipping demand. That concern is misguided, an economic adviser to Trump, billionaire Wilbur Ross, insists.

At the Marine Money Ship Finance Forum in New York on 9 November, Ross provided insider details on Trump’s plans for trade, economic stimulus, and energy and argued the admittedly partisan case that shipping stands to reap significant upside.

“I know people in shipping have been very worried about the potential for trade wars. People say he’ll just lunge in and put on all kinds of tariffs, which will make for a World War III of trade and bring about a global depression. Fear not. That’s not at all what he has in mind,” said Ross.

“What got people thinking he was going to be brash and gun-slinging was the infamous quote, or I should say misquote, that he was going to just slam a 45% tariff on everything coming out of China and good luck to them. That’s not what he said or intended to say. What he actually said was that if it turns out that the Chinese currency is undervalued by as much as 45% and if it turns out that they won’t negotiate with us on improvements in our trade balance, then it may become necessary as a tactic to threaten them with as much as a 45% tariff.

“That’s simply an explanation of one potential negotiating strategy. They are not the words of a madman who is just going to throw big tariffs on everything willy-nilly. This is not going to be a blunderbuss,” claimed Ross.

“What I believe there will be instead are negotiations, product by product and country by country, in a very systematic way, with our country adopting something like the mentality of a large industrial customer. A large industrial customer does a number of things. One of them is to play off suppliers against each other. We’ve never tried playing off what I call our suppliers – namely our trading partners – against each other,” said Ross.

He cited the example of China’s huge share of footwear and apparel exports to the United States. “Think what it would be worth to other countries that are lesser trading partners for us to rejigger our tariff structure to help them gain market share from China and think what things China might be willing to do to help us if we are willing to protect or even enhance their share.”

Ross offered several examples of the kinds of concessions the US might look for from China. “They could redirect their purchases of LNG from where they’re buying it now to the US, which wouldn’t cost them anything, but it would help a lot with our trade deficit. Or they could relax their quota on the import of US cotton. It’s a little bit ludicrous that they’re this huge exporter to us of apparel but they have quotas on US cotton.

“There’s plenty of room for redirection of goods. This doesn’t involve a trade war. What it would involve is redistributing our trade deficit more appropriately and changing the surplus and deficit figures of a variety of other countries,” said Ross.

He noted that both houses of Congress are now Republican, the same party as Trump, and even if there is pushback on his trade plan due to the core Republican belief in free trade, the president has “a tremendous amount of power to put on tariffs, change tariffs, and drop tariffs without consultation with Congress, so I think major portions of the concept he has for trade will go through”.

To stimulate the US economy, Trump plans to institute a massive capital works programme to replace the country’s crumbling infrastructure, to be funded by private investors who would be awarded federal tax credits. “That could unleash huge amounts of capital for infrastructure,” said Ross, who noted that this would funnel a large amount of wages to construction workers “who will have more disposable income, which will build up demand for all kinds of products, some of which would be imported products” – a positive for container demand.

“We think the whole key is to stimulate the economy at the consumer level and create a stronger US economy that will help drive the global growth engine, including for trade, which is going to be a good thing for shipping. [Trump] is going to be more stimulative to the economy over the next several years than Hillary Clinton would have been, and when you think about it, what drives shipping is consumption, particularly consumption in the US.”

Ross said that energy policy will also be a major pillar of Trump’s agenda. He said that the president-elect could foster greater LNG shipping trade by granting more export licences. “There are a dozen or so [projects] that have applied for export permissions but those applications were sidelined under the Obama administration,” he said.

In the oil sector, Ross predicted that Trump would remove “very burdensome regulations on shale” that hamper US oil producers. Trump could further support the oil sector by “opening up more federal lands that could have been put out to private exploration but haven’t been” under Obama.

“Once OPEC gets its act together, which I think it will, then the swing factor in global production is very likely to be US shale,” he said. In other words, US production is currently being curtailed by lower oil prices, but if OPEC members co-operate and cut production to an extent that raises prices, US production – and exports – would rise to an equilibrium level that caps global oil pricing. The more Trump supports US producers, the more tanker operators serving US exports stand to gain.

As with the new trade strategy, Ross believes there is now little standing in the way of Trump’s implementation of his energy policy. “It has been the Democrats in Congress who have had the big problem with hydrocarbons. With the Republican Congress, I don’t think there will be much controversy over his energy policies.”