Expansion of Battery Recycling Infrastructure

Significant investments are underway in France to expand battery recycling and reconditioning facilities. Projects like Weeecycling and new reconditioning centers will boost capacity, create jobs, and support circular economy goals, directly impacting supply chains and operational costs.

Supply Chain Vulnerability and Resilience

Global supply chains remain exposed to tariff fluctuations, geopolitical disputes, and logistical disruptions. France faces heightened risks from both US-EU tensions and broader global uncertainties, compelling firms to reassess sourcing, inventory, and resilience strategies for 2026 and beyond.

Escalating US-China Trade Tensions

Trade tensions between China and the US remain elevated, with renewed tariffs and retaliatory measures. Despite a 19.5% drop in exports to the US in 2025, China posted a $1.2 trillion trade surplus, highlighting its resilience but also the ongoing risk of further escalation and global supply chain disruptions.

Geopolitical Risk: U.S.-China Rivalry and Canadian Autonomy

Canada’s efforts to balance relations with both the U.S. and China expose businesses to geopolitical risks, including retaliatory tariffs, regulatory shifts, and political pressure. The evolving stance on ‘strategic autonomy’ will shape future trade, investment, and supply chain resilience.

Tariffs, Trade Tensions, and Supply Chain Realignment

The US continues to escalate tariffs, notably on South Korea, Taiwan, and Canada, as part of an 'America First' industrial policy. Recent deals require massive foreign investment in US manufacturing in exchange for tariff relief, with Taiwan and South Korea pledging over $600 billion. These policies are pressuring global supply chains to relocate to the US, but also driving allies and rivals to diversify away from American markets, increasing long-term uncertainty for international business operations.

Gold Reserves Offset Asset Freezes

Russia’s gold reserves rose by $216 billion since 2022, now making up 43% of its international reserves. This windfall has partly offset the impact of $300 billion in frozen Western assets, providing Moscow with financial resilience despite sanctions and isolation.

EU-Mercosur Trade Deal Backlash

The imminent EU-Mercosur trade agreement faces strong opposition from French farmers and political factions, who fear market flooding by cheaper imports and threats to food security. Protests and government support measures highlight deep divisions, affecting agricultural supply chains and broader trade policy.

Economic Reform and Investment Momentum

Recent reforms, improved energy reliability, and enhanced infrastructure have strengthened South Africa’s economic outlook. The country has exited the FATF grey list and received a credit rating upgrade, attracting renewed interest from global investors and supporting capital inflows.

Semiconductor Sector Drives Growth

South Korea’s semiconductor industry is experiencing a supercycle, with Samsung forecasting record profits and exports up nearly 39% year-on-year. However, U.S. tariffs and global competition, especially from China and Taiwan, present ongoing risks to supply chains and market access.

Chronic Export Underperformance and Structural Barriers

Despite ambitious targets to reach $60 billion in exports, Pakistan’s export-to-GDP ratio has declined to 10.4%. Structural issues—such as weak infrastructure, regulatory uncertainty, and financial system crowding out private credit—continue to hamper export growth and international trade integration.

US-China Trade and Geopolitical Tensions

Ongoing US-China rivalry continues to drive restrictive trade measures, especially in technology and critical goods. These tensions create persistent risks of supply chain disruptions, regulatory changes, and retaliatory actions that international businesses must navigate to ensure operational continuity.

Foreign Exchange and Debt Pressures

Egypt faces significant external debt obligations, with $50 billion due in 2026 and total external debt at $163.7 billion. While foreign reserves reached $51.45 billion, reliance on Gulf deposits and IMF support underscores persistent currency and liquidity risks.

Infrastructure Investment and Public Finance

Vietnam is launching a new wave of infrastructure projects, targeting $5.5 billion in foreign loans for 2026 and up to $38 billion by 2030. While these investments aim to support growth and connectivity, persistent disbursement delays, land clearance issues, and public debt management remain key operational risks.

Energy Transition and Green Ammonia Expansion

Japan is leading Asia in green ammonia co-firing projects and renewable energy investments, targeting decarbonization of power generation. Major projects and international supply agreements position Japan as a regional leader in clean energy, with significant implications for energy-intensive industries and supply chains.

Manufacturing Push Through Deregulation

India aims to triple exports to $1.3 trillion by 2035 by prioritizing manufacturing in 15 sectors and launching the National Manufacturing Mission. The focus is on regulatory simplification, building manufacturing hubs, and reducing red tape rather than heavy subsidies, to boost competitiveness and attract investment.

Suez Canal Economic Zone Expansion

The Suez Canal Economic Zone reported a 55% revenue increase and $14.2 billion in contracted investments, with new projects in industrial and port sectors. Despite recent disruptions, the zone remains pivotal for global supply chains, regional manufacturing, and Egypt’s export growth strategy.

Global Supply Chain Realignment

China’s supply chains have reallocated through third-party countries like Vietnam and Mexico, maintaining effective access to US and Western markets despite tariffs. This rerouting complicates compliance, origin tracing, and risk management for international businesses.

Trade Policy Uncertainty and Diversification

US tariffs (currently 19%) and global trade tensions are prompting Thailand to diversify export markets beyond the US and China. Efforts to expand FTAs, streamline certification, and access India and the Middle East are central to trade resilience and supply chain adaptation.

Technology Sector Resilience and Global Ties

Despite regional instability, Israel’s technology and cybersecurity sectors attract substantial investment and foster international partnerships. Recent major funding rounds and cross-border collaborations, especially in cybersecurity, underscore the sector’s resilience and its centrality to Israel’s economic strategy.

Competitive Tensions and Strategic Alliances

Major French automakers, including Renault and Stellantis, are expanding their electrified portfolios but show reluctance to fully align on joint battery ventures. This rivalry shapes the pace of innovation, localization of supply chains, and the scope for international partnerships.

Energy Infrastructure Under Relentless Attack

Russian strikes have caused catastrophic damage to Ukraine’s energy grid, triggering rolling blackouts, heating and water outages, and mass evacuations in major cities. The resulting instability severely disrupts industrial operations, logistics, and daily business continuity, heightening operational risks for all sectors.

Currency Volatility and Financial Innovation

Pakistan’s rupee remains vulnerable amid external deficits and debt pressures. The government’s partnership with World Liberty Financial for a dollar-pegged stablecoin aims to boost remittance flows and financial inclusion, but regulatory, ethical, and geopolitical risks remain for cross-border transactions and digital finance.

Resilience and Diversification of Manufacturing

TSMC and other Taiwanese firms are accelerating overseas expansion, notably in the US, Germany, and Japan, to mitigate geopolitical and operational risks. While Taiwan remains the core hub, a gradual shift in advanced manufacturing capacity abroad is underway.

Renewable Energy and Green Transition

Saudi Arabia is accelerating renewable energy deployment, with solar and wind capacity in the MENA region projected to rise tenfold by 2040. Major joint ventures and new energy facilities, like CATL’s Riyadh center, support the Kingdom’s decarbonization and industrial diversification, creating new investment and supply chain opportunities.

US-Taiwan Semiconductor Trade Accord

The 2026 US-Taiwan trade deal slashes US tariffs on Taiwanese goods to 15% in exchange for at least $250 billion in Taiwanese chip investments in the US. This reshapes global supply chains, incentivizes US-based production, and strengthens bilateral economic ties.

Energy Revenue Decline Strains Budget

Russia’s oil and gas revenues fell 24% in 2025, hitting a five-year low and driving a record budget deficit of 2.6% of GDP. Lower prices, sanctions, and Ukrainian attacks undermine fiscal stability, pressuring government spending and increasing economic uncertainty for investors.

Nuclear Program Uncertainty and Sanctions Risk

Iran’s nuclear activities and reduced cooperation with international monitors continue to drive sanctions risk. The lack of diplomatic progress and threat of further restrictions create long-term uncertainty for multinational enterprises considering trade or investment in Iran.

Ambitious Infrastructure Investment Drive

Vietnam is launching major infrastructure projects, including high-speed rail and expanded logistics networks, to support growth and regional connectivity. These initiatives are designed to enhance export capacity, attract FDI, and improve the country’s competitiveness in global value chains.

Currency Volatility and Inflation Management

Egypt has reduced inflation to 12.3% amid global shocks but remains vulnerable to currency volatility, external financing gaps, and import costs. Monetary policy targets further inflation reduction, while international aid and remittances provide temporary relief. Persistent macroeconomic imbalances continue to affect business planning and consumer demand.

Semiconductor Supply Chain Reshoring

The agreement aims to relocate up to 40% of Taiwan’s semiconductor supply chain to the US. TSMC and peers will build multiple advanced fabs in Arizona, backed by $250 billion in credit guarantees, reducing US reliance on Taiwan and mitigating geopolitical risks.

Private Sector Expansion and Economic Reform

Egypt aims for the private sector to account for over 70% of total investment by 2030, up from 65% currently. Structural reforms focus on limiting state spending, enhancing transparency, and fostering a competitive business environment for international investors.

Logistics and Infrastructure Bottlenecks

Despite increased infrastructure investment, Brazil faces persistent logistical challenges, including high costs and operational complexity. Recent downsizing by logistics firms like FedEx highlights ongoing difficulties, impacting supply chain efficiency and competitiveness for exporters and multinationals.

Trade Policy Shifts and Bilateral Agreements

A forthcoming US-Indonesia trade agreement could quadruple bilateral trade, offering tariff exemptions for Indonesian commodities and US access to critical minerals. However, the deal’s structure and alignment with industrial policy will determine whether Indonesia can achieve balanced, sustainable trade growth.

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.

Green Energy and Climate Leadership

India is targeting 5 million metric tons of green hydrogen annually by 2030 and has achieved 266 GW of renewable capacity. Aggressive policies and incentives are attracting global capital, making India a hub for green energy manufacturing and a leader in the global energy transition.

Commodity Export Volatility

South Africa’s economy benefits from strong performance in mining and agriculture, with rising metal prices and a robust rand supporting exports. However, global commodity price fluctuations and logistical bottlenecks pose risks to export revenues and supply chain resilience.