gathered in Davos

US President Donald Trump promised the world’s key decision-makers lower taxes if they brought manufacturing to the US and threatened to impose tariffs if they didn’t in his Davos address on Thursday.

Speaking by video from the White House to the annual summit in Switzerland, on just his third full day in office, Trump ran through the slew of executive actions he signed since his swearing-in, claiming that he had a “massive mandate” from the American people to bring change.

Then came the carrot and the stick.

“Come make your product in America and we will give you among the lowest taxes as any nation on earth,” Trump said.

“But if you don’t make your product in America, which is your prerogative, then very simply, you will have to pay a tariff — differing amounts — but a tariff, which will direct hundreds of billions of dollars and even trillions of dollars into our treasury to strengthen our economy and pay down debt under the Trump administration.”

Experts have pointed out that tariffs, which are imposed on incoming goods and services, are covered mainly by the end consumer. In Trump’s case, imposing tariffs on goods from Europe and the rest of the world would hurt the purchasing power at home and the US economy instead, they say.

Trump, who spoke Wednesday to Saudi Arabia’s crown prince, also said to those gathered in Davos that the kingdom wants to invest $600 billion (€575.6bn) in the US but that he would ask Crown Prince Mohammed bin Salman to increase it to $1 trillion (€959bn) — a remark that drew some laughter from the crowd in the hall.

Davos founder Klaus Schwab has invited Trump to speak at the summit in person next year.