Tariff volatility and legal shifts

Supreme Court curtailed emergency-tariff authority, but the administration pivoted to temporary Section 122 surcharges and signals broader use of Sections 232/301. Rapid rate and exemption changes raise pricing, contracting, and inventory risks for importers and exporters.

Middle East war disrupts logistics

Iran war effects include Strait of Hormuz disruption and heightened war-risk insurance, while Turkey–Iran border day-trip crossings were suspended. Shipping delays, higher freight premiums, and rerouting pressure supply chains; Turkey may benefit as an alternative Eurasian logistics hub.

Labour relations and strike risk

Union resistance to labour-rule changes and recurring industrial action create disruption risk for logistics, retail and services. Current debates include proposals affecting May 1 work rules, highlighting France’s sensitivity around working-time protections and potential for coordinated union pushback.

USMCA review and tariff risks

The 2026 USMCA/CUSMA review is raising tariff and rules-of-origin uncertainty, with U.S. officials signaling higher baseline tariffs and stricter content rules. This volatility is delaying investment decisions, reshaping North American sourcing, and increasing compliance and pricing complexity.

Tighter monetary policy, higher costs

The RBA lifted the cash rate to 3.85% and signalled more tightening if inflation stays above the 2–3% band. Higher funding costs and a firmer AUD reshape project hurdle rates, M&A financing, and consumer demand forecasts for exporters and retailers.

Tighter digital-platform compliance regime

Government pressured Meta over harmful-content controls, citing only 28.47% takedown compliance and demanding algorithm transparency under the ITE Law. Enforcement and potential blocking raise operational risk for digital firms, advertising, and cross-border data strategies amid trade commitments affecting regulatory space.

Shadow fleet oil to China

Iran sustains exports via an IRGC-linked “shadow fleet” (estimated 400–430 tankers) using AIS blackouts, flag-hopping and ship-to-ship transfers. Flows of ~1.1–1.6 mb/d largely to China at 6–10% discounts reshape energy trade and raise counterparty, fraud and reputational risks.

Power sector reform and costs

Eskom supply has stabilised, but output remains below 2025 levels (13,007 GWh Jan 2026) and tariffs are rising (Nersa 8.76% effective). Grid expansion needs ~14,000 km lines (R440bn). Firms face price volatility, self-generation and wheeling opportunities.

Renewables scale-up facing cost constraints

India is reassessing offshore wind tenders (1 GW) amid high steel costs and weak bidder appetite; floating solar remains ~700 MW commissioned despite large potential. Policy support, VGF and domestic manufacturing (ingots/wafers) will shape project bankability and clean-energy supply chains.

New government coalition policy risks

Election results largely certified, enabling government formation in April with a Bhumjaithai-led coalition. Policy direction on stimulus, regulation, and infrastructure may shift quickly, creating near-term uncertainty for permits, public procurement, and investor decision timelines.

UK crypto and payments regulation

The FCA has selected four firms, including Revolut, for a stablecoin regulatory sandbox starting Q1 2026, with policy statements due summer 2026 and a crypto authorisation gateway opening Sept 2026. Payments, settlement and treasury operations should prepare for new rules.

Higher-for-longer rate uncertainty

Federal Reserve minutes indicate officials want more inflation progress before further cuts, keeping policy near neutral around 3.5–3.75%. This sustains elevated financing costs, pressures leveraged transactions, and increases FX and demand uncertainty for exporters and US-focused investors.

Manufacturing upcycle and FDI surge

FDI disbursement hit a five-year high in early 2026, with over 80% flowing into processing/manufacturing and growing interest in electronics, semiconductors, and supporting industries. This strengthens Vietnam’s role in global production networks but intensifies competition for land, labor, and suppliers.

Sanctions escalation and compliance burden

Fresh Iran measures target shadow-fleet vessels and UAE/Türkiye-linked networks, expanding secondary-sanctions exposure for shippers, traders, banks, and insurers. Expect heightened screening on maritime AIS anomalies, beneficial ownership, and petrochemical trade flows, raising transaction friction and delays.

Power supply constraints for AI

Rising electricity demand from semiconductors and AI data centers could add about 5GW by 2030—roughly enough for 3.75 million homes—tightening reserve margins. This raises operational risk for fabs, escalates power costs, and may influence siting of data centers and packaging capacity.

ART RI–AS ubah aturan dagang

Perjanjian resiprokal RI–AS menetapkan tarif 19% untuk banyak ekspor RI namun memberi pengecualian 0% pada komoditas tertentu. Annex mencakup komitmen non‑tarif (TKDN, perizinan impor, data, pajak digital) yang dapat membatasi ruang kebijakan dan memicu penyesuaian kepatuhan.

Oil policy drives macro volatility

Saudi-led OPEC+ decisions to adjust output amid regional conflict keep Brent highly sensitive to geopolitical headlines. Price swings affect fiscal space, payment cycles, and capex pacing, while energy-intensive industries and freight costs face renewed volatility across contracts and hedging strategies.

Tax administration and policy uncertainty

Revenue underperformance (Rs428bn shortfall in eight months) is pushing target revisions and stronger enforcement. Expect more audits, withholding, digitalisation and tariff rationalisation. Compliance burdens, customs clearance times and the predictability of effective tax rates remain key concerns.

Data reform and AI governance divergence

UK data-use and access reforms and evolving AI governance may diverge further from the EU AI Act and GDPR interpretations. Multinationals should anticipate changing rules on lawful processing, automated decisioning, and cross-border data transfers, raising compliance and product localisation costs.

Pivot Toward US LNG Contracts

To bolster energy security, CPC/MOEA are shifting LNG toward the US: roughly 10% today, targeted 15–20% by 2029, including a 25‑year Cheniere contract (deliveries from June; 1.2m tons/year from next year). This reshapes procurement and FX exposure.

Mega FTAs reshape market access

India’s new trade diplomacy is lowering barriers and rewriting sourcing economics. The India‑EU FTA delivers zero-duty access for key exports while phasing down India’s high auto and wine tariffs; India‑US reciprocal tariffs reportedly fell from 25% to 18%, improving predictability.

Commerce UE-Mercosur et mesures miroirs

L’application provisoire de l’accord UE‑Mercosur ravive la contestation agricole et le débat sur l’interdiction d’importations non conformes aux normes françaises (pesticides). Risques de nouvelles exigences SPS, contrôles frontière et tensions commerciales impactant agroalimentaire et distribution.

Sector tariffs via Section 232

National-security tariffs remain a durable lever, including reported rates such as 50% steel/aluminum and 25% autos/parts, plus other targeted categories. Sector-focused duties distort competitiveness, encourage regionalization, and complicate rules-of-origin, customs valuation, and transfer pricing.

Domestic gas pricing and allocation

Industri mendorong batas harga LNG domestik ≤US$9/MMBtu dan pembatasan substitusi regasifikasi (≤15% alokasi PJBG) agar daya saing manufaktur terjaga. Ketidakpastian harga/volume gas memengaruhi keputusan investasi pabrik, kontrak energi, serta risiko biaya untuk operasi intensif energi.

China exposure and de-risking

Germany’s export model faces a sharper ‘China shock’: imports rise while market access and competition concerns grow. Business groups cite intervention and uneven competition; dependence on rare earths persists. Expect tougher screening, diversification, and higher supply-chain resilience costs.

Air-defence supply constraints risk

Ukraine’s ability to protect infrastructure depends on interceptor availability, notably Patriot PAC‑3. Rising global demand—especially amid Middle East escalation—may delay deliveries and force harder protection trade-offs. This elevates operational risk for energy‑intensive sites and increases the value of resilience investments.

Semiconductor export controls tightening

Taiwan’s chip sector faces intensifying geopolitics: proposed legislative oversight of advanced chip-technology exports and expanding US global AI-chip licensing could constrain shipments, complicate end-user verification, and reshape fab location decisions—affecting capacity allocation, lead times, and customer qualification processes.

Nuclear file and snapback risk

IAEA reports cite large near-weapons-grade uranium stockpiles and restricted inspector access, while European powers move toward restoring UN sanctions. Heightened “snapback” probability increases legal uncertainty for trade finance, shipping documentation, and long-horizon investments in Iran-linked projects.

Antitrust and platform regulation

DOJ remedies in the Google case, including potential Chrome divestiture and forced sharing of search/AI assets, signal tougher U.S. platform regulation. Multinationals should anticipate changes to digital advertising, data access, cybersecurity responsibilities, and cross-border AI deployment strategies.

Reconstruction governance and tender scrutiny

Anti-corruption measures around reconstruction funding are intensifying, with regional cooperation and new public-investment monitoring tools, while some strategic-minerals tenders draw transparency disputes. For contractors and investors, procurement integrity, beneficial ownership checks, and dispute risk are central.

Russia trade rerouting and border friction

Trade increasingly reroutes via China, the Far East, Belarus and Central Asia as checks tighten. Border-crossing times for China–Kazakhstan–Russia routes have tripled at times, with delays up to a month and transport costs up 5–10%, straining inventory planning and service levels.

Corporate governance reforms accelerate

A potential Toyota cross-shareholding unwind of about ¥3tn (~$19–24bn) signals intensifying Tokyo Stock Exchange pressure to dismantle strategic holdings. Expect higher buybacks, M&A, and activism, changing valuation dynamics and partnership stability for foreign investors and suppliers.

Energy imports and distributed generation

Electricity imports hit a February record of 1.26 million MWh (+41% month-on-month), with reliance on Hungary and Slovakia, while firms invest in on-site generation. Expect higher operating costs, grid constraints, and rising demand for batteries, gas, and resilient power solutions.

Maritime industrial policy and fees

The Maritime Action Plan proposes rebuilding shipyards, expanding US-flag capacity, and considering fees on foreign-built vessels entering US ports to fund a trust. If implemented, ocean freight costs, routing choices, and port-call economics could materially change for importers and carriers.

Energy security and LNG buffers

Japan is bolstering LNG inventories (2.19m tons, ~12 days utility cover) and using a Strategic Buffer LNG scheme as Gulf disruptions lift prices. Firms face higher energy-cost uncertainty, but Japan’s storage reduces immediate outage risk.

Won Volatility and Capital Flows

Won volatility persists amid overseas investment flows and risk sentiment; authorities issued US$3bn FX stabilization bonds and swap lines. BOK is expected to hold rates around 2.50% through 2026. FX hedging, pricing, and repatriation strategies remain critical.