OPEC+ Policy and Oil Market Stability

Saudi Arabia, as a key OPEC+ leader, is maintaining steady oil output despite an 18% price drop in 2025 and geopolitical tensions. The Kingdom prioritizes market stability, but oil revenues remain vulnerable to global oversupply, regional conflict, and sanctions, impacting fiscal and trade balances.

Semiconductor Supply Chain Vulnerabilities

Taiwan's dominance in advanced chip manufacturing, led by TSMC, is critical to global technology and AI sectors. Geopolitical risks, export controls, and potential disruptions from conflict or sanctions pose systemic threats to international supply chains and investment strategies reliant on Taiwanese semiconductors.

Environmental Policies and Sustainability Trends

Increasing emphasis on environmental regulations and sustainability practices affects industries such as manufacturing and energy. Compliance with stricter environmental standards may increase operational costs but also opens opportunities in renewable energy and green technologies.

Societal Strains: Water, Energy, and Labor

Chronic water shortages, energy mismanagement, and rising unemployment compound Iran’s economic crisis. These systemic issues undermine productivity, increase social risk, and pose long-term challenges for sustainable business operations.

Strategic Pivot to Asian and Global Markets

Canada is actively seeking to double non-U.S. exports by 2035, leveraging new agreements with China and expanding ties with Asia-Pacific and plurilateral blocs. This pivot aims to reduce vulnerability to U.S. trade policy shocks and foster new investment and technology partnerships, but increases exposure to geopolitical risks.

Resilience of Ukrainian Supply Chains

Despite ongoing conflict and infrastructure damage, Ukrainian ports and logistics networks have demonstrated resilience, maintaining agricultural exports and trade flows. This adaptability is vital for global supply chains and positions Ukraine as a strategic partner in food and commodities markets.

Regional Funding and Infrastructure Gaps

Persistent underinvestment and complex funding formulas, especially in Wales and the North, continue to hinder infrastructure upgrades. Businesses face challenges in logistics, labour mobility, and regional development, with new government strategies aiming to address disparities.

Startup Ecosystem and Venture Investment Surge

South Korea’s government-led support for startups, highlighted at CES 2026, is fostering innovation in AI, deep-tech, and mobility. Seoul’s global ranking and record FDI inflows signal robust opportunities for venture capital, partnerships, and technology-driven business models.

Political and Regional Security Instability

Ongoing political uncertainty and regional security risks, particularly regarding Afghanistan and Kashmir, affect investor confidence. Pakistan and China are urging verifiable action against terrorism in Afghanistan, while regional disputes continue to pose operational and reputational risks.

Infrastructure And Energy Sector Strains

Despite vast oil and gas reserves, Iran faces energy mismanagement, rolling blackouts, and water shortages. Infrastructure decay and unreliable utilities disrupt industrial operations, logistics, and supply chain reliability for domestic and foreign businesses.

Shadow Fleet and Sanctions Evasion

Russia has developed a ‘shadow fleet’ of old tankers and parallel logistics to circumvent Western sanctions, shifting trade toward India, China, and Turkey. This opaque system increases operational risks and regulatory scrutiny for international businesses.

Structural Economic Reforms and Growth

Comprehensive reforms in fiscal, monetary, and supply-side policies have strengthened Turkey’s economic fundamentals. Infrastructure upgrades, improved reserve levels, and reduced external debt costs foster a more attractive climate for foreign direct investment and export-oriented operations.

Private Equity and Real Estate Investment Boom

Private equity investments rebounded 44% in Q4 2025, while real estate capital inflows hit a record $14.3 billion, up 25%. Foreign and domestic investors are focusing on land, office, and warehousing, signaling robust long-term confidence in India’s growth trajectory.

Infrastructure Investment Drives Construction Boom

US infrastructure spending, supported by federal and state initiatives, is fueling robust growth in construction and heavy equipment markets. This trend supports supply chain modernization and creates opportunities for global suppliers, though regulatory and environmental uncertainties persist.

China And Russia Strategic Partnerships

Iran is deepening economic and military ties with China and Russia, including discounted oil sales and infrastructure projects. While these partnerships offer some economic lifelines, they complicate Western business interests and expose supply chains to secondary sanctions.

US-Saudi Relations and Security Realignment

Saudi Arabia is recalibrating its security partnerships, balancing US ties with new regional alliances and arms deals with Pakistan. Diverging interests with Washington and assertive regional diplomacy reflect a more independent Saudi foreign policy, affecting the risk calculus for Western businesses.

Political Stability and Governance

Mexico's political environment, characterized by recent electoral outcomes and governance reforms, influences policy continuity and regulatory frameworks. Political stability is crucial for investor confidence and long-term strategic planning in trade and business operations.

Trade Policy and Tariff Adjustments

Recent modifications in trade policies, including tariff adjustments and negotiations with key partners like China and the EU, impact import-export dynamics. These changes influence cost structures and market access for multinational corporations.

CUSMA Renegotiation and Trade Bloc Realignment

With Canada’s exports to the U.S. at a 30-year low, the upcoming CUSMA renegotiation is pivotal. Outcomes could range from a complete overhaul to no agreement, pushing Canada to accelerate trade diversification with the EU, Asia, and the Global South, impacting long-term investment strategies and supply chain resilience.

Regulatory Reforms and Private Sector Incentives

The government is implementing new tax incentives, customs reforms, and digitalization to attract investment and support local industry. IMF reviews and international partnerships are driving structural changes, but bureaucratic hurdles and military influence still challenge private sector growth.

Political Continuity Amid Leadership Transition

Vietnam’s 14th Communist Party Congress in January 2026 will set leadership and policy direction through 2030. While continuity is expected, the party aims for 10% annual GDP growth, balancing reduced foreign dependence with high-tech FDI attraction. Centralized authority may enhance decisiveness but narrows internal checks, impacting business predictability.

Persistent Cartel Violence and Risk

Ongoing cartel violence, drug trafficking, and organized crime remain major risks for business operations, especially in northern states. Despite recent high-profile arrests and extraditions, fragmentation and adaptation of criminal groups continue to threaten logistics, investment, and workforce safety.

Fiscal Policy and Tax Reform Uncertainty

South Africa faces potential tax increases, including VAT and digital economy taxes, to address revenue shortfalls. Fiscal consolidation and improved ratings have boosted investor sentiment, but persistent debt and policy uncertainty could impact future investment strategies and operational costs.

Political Instability and Leadership Uncertainty

Prime Minister Keir Starmer faces internal Labour dissent and potential leadership challenges, especially with poor polling and upcoming local elections. This political volatility creates uncertainty for businesses and investors, affecting confidence in the UK’s policy direction and regulatory environment.

Geopolitical Stability

Regional tensions and Saudi Arabia's involvement in Middle Eastern conflicts affect investor confidence and trade routes. Stability in the kingdom is crucial for maintaining secure supply chains and fostering a favorable business environment for international investors.

Defense Sector Faces Geopolitical Volatility

Saab and other Swedish defense firms have experienced stock fluctuations due to shifting global security dynamics, notably the Ukraine peace process. Defense contracts remain lucrative but are increasingly exposed to geopolitical risk and demand uncertainty.

Regulatory Modernization and Market Governance

Recent reforms have simplified foreign investor access, eliminated complex qualification barriers, and improved market transparency. However, challenges persist around regulatory clarity, governance standards, and foreign ownership limits, requiring ongoing attention from international investors and partners.

Currency Volatility and Inflation

Iran faces high inflation and significant currency devaluation, undermining economic stability. This volatility complicates pricing, contract enforcement, and financial planning for foreign investors and multinational corporations, increasing the cost and risk of doing business in Iran.

Geopolitical Realignment and Investment Climate

Israel’s expanding influence in the Middle East, including new alliances and recognition of Somaliland, is reshaping regional dynamics. However, persistent instability and election-year politics create uncertainty for investors and complicate long-term strategic planning.

EU-Mercosur Trade Agreement Approval

The historic EU-Mercosur trade deal, set for signing January 17, will eliminate tariffs on over 90% of bilateral trade, creating the world’s largest free trade zone. This will boost Brazilian exports by US$7 billion, especially in processed goods and agribusiness, but also impose stricter sustainability standards.

Geopolitical Tensions Disrupt Trade

Escalating US–China and US–Venezuela tensions heighten global trade uncertainty, impacting Thai exports, energy prices, and supply chains. Businesses face increased logistics costs and market volatility, especially in energy-intensive and export-oriented sectors, requiring robust risk management and market diversification strategies.

Border Conflict Disrupts Stability

The recent Thai-Cambodian border conflict led to over 100 deaths and half a million displaced, disrupting trade and supply chains. Fragile ceasefires and ongoing tensions threaten cross-border commerce, investor confidence, and regional logistics operations.

Green Growth and Infrastructure Modernization

China’s 15th Five-Year Plan emphasizes sustainable development, green manufacturing, and infrastructure upgrades. Major investments in renewable energy, digital infrastructure, and smart logistics offer opportunities for international partners, but also raise competitive and regulatory challenges.

Agricultural Supply Chain Vulnerabilities

Railway grain shipments fell 27.3% in 2025, and wheat exports dropped 25% in December due to Russian strikes on ports and logistics. These disruptions, along with delayed harvests and market competition, threaten Ukraine’s role as a global food supplier and heighten risks for agribusiness investors.

Geopolitical Tensions with China

Taiwan faces ongoing geopolitical tensions with China, impacting international trade and investment. The risk of military conflict or political coercion creates uncertainty for global supply chains, especially in technology sectors. Businesses must consider these risks in strategic planning and risk mitigation to safeguard operations and investments in Taiwan.

Geopolitical Tensions and Regional Rivalries

Turkey’s assertive foreign policy, involvement in Syria, and competition with Israel and Greece have heightened regional tensions. These dynamics increase operational risks for international businesses, especially in energy, defense, and logistics, and may trigger regulatory or security disruptions.