EU Considers Anti-Coercion Measures

In response to US tariffs, the EU is preparing to activate its anti-coercion instrument, potentially restricting US market access and imposing retaliatory tariffs. This unprecedented move could escalate into a full-scale trade war, amplifying risks for Finnish companies.

US Tariffs and Trade Tensions

The imposition of US tariffs, particularly on automotive and manufactured goods, is straining South Africa’s export sectors. These measures threaten jobs, especially in manufacturing, and create uncertainty for investors reliant on US market access, complicating trade and investment strategies.

Innovation, AI, and Digital Transformation

India is accelerating its digital economy through AI, tech innovation, and digital asset regulation. The government is fostering R&D, digital infrastructure, and responsible AI, positioning India as a global leader in digital services and technology-driven growth.

Energy Transition and LNG Import Surge

Egypt’s domestic gas production decline has led to record LNG imports—over 9 million metric tons in 2025—mainly from the US and Qatar. New energy deals and infrastructure are reshaping Egypt’s energy mix, with a strategic pivot toward renewables and regional energy hub ambitions.

Energy Transition and Nuclear Expansion

France’s €52 billion commitment to new nuclear reactors underscores its strategy for energy security and decarbonization. However, hardware shortages, dependence on Asian imports, and rising energy nationalism across Europe create operational and investment uncertainties for energy-intensive industries and infrastructure projects.

Expansion of Non-Energy Exports to Allies

Russia is targeting a 67% increase in non-energy exports by 2030, focusing on machinery, chemicals, and agriculture to 'friendly' countries. This diversification aims to reduce reliance on hydrocarbons and offers new opportunities and risks for foreign investors in these sectors.

Regulatory Reforms and Business Environment

Ongoing economic reforms target improved investment climate, streamlined licensing, and expanded digital and physical infrastructure. The government is enhancing free zones, logistics corridors, and industrial clusters, notably in the Suez Canal Economic Zone, to boost exports and attract diversified FDI, especially in manufacturing and green energy.

Strategic Expansion of Gas Infrastructure

Brazil is investing hundreds of millions of dollars in new pipelines, LNG terminals, and storage to secure domestic gas supply, reduce reliance on imports, and support industrial growth. Projects like TAG, SEAP, and GASOG are critical for energy security, especially amid declining Bolivian imports and rising pre-salt production.

AI and Technology Innovation Boom

The US remains the global leader in AI and advanced technology investment, with robust growth in AI-related sectors offsetting broader economic headwinds. Export controls, however, risk isolating US firms from key markets and accelerating foreign competitors’ innovation, impacting long-term competitiveness.

China-Saudi Economic Ties Deepen

Saudi Arabia is strengthening economic relations with China, expanding trade, investment, and technology cooperation. This shift may influence regulatory standards, competitive dynamics, and supply chain strategies for businesses with exposure to both Western and Chinese markets.

Shift Toward High-Value Industries

Thailand is accelerating reforms to attract foreign direct investment in high-tech, green infrastructure, and wellness tourism, moving away from traditional manufacturing. This strategic pivot aims to boost long-term competitiveness amid declining FDI and rising regional competition, especially from Vietnam and Indonesia.

Tightening Export Controls and Tech Restrictions

Beijing is intensifying export controls on critical goods, including rare earths and dual-use technologies, to safeguard national security and leverage supply chain influence. These measures impact global technology access and increase compliance risks for international firms.

China-Pakistan Economic Corridor Acceleration

CPEC Phase 2.0 is being fast-tracked amid global supply chain disruptions and regional security threats. China’s planned $10 billion investment and new infrastructure projects position Pakistan as a pivotal trade gateway, but success hinges on security, regulatory clarity, and regional stability.

Escalating Cross-Strait Tensions

China’s military drills, incursions, and amphibious exercises near Taiwan have intensified, raising the risk of conflict. These tensions threaten regional stability and global supply chains, prompting increased US arms sales and defense cooperation with Taiwan.

Mega-Projects and Infrastructure Investment

Saudi Arabia is reallocating capital from delayed real estate projects to logistics, tourism, and infrastructure, including giga-projects like NEOM and the Red Sea. These initiatives are central to supply chain strategies and offer significant opportunities for foreign contractors, technology firms, and financiers.

EU and Denmark Strengthen Arctic Security

Denmark, with EU support, is investing billions in Arctic defense—new naval vessels, surveillance drones, and satellite capacity—to counter US and Russian ambitions. This military buildup affects logistics, shipping routes, and risk calculations for businesses operating in the region.

Clean Energy and Green Hydrogen Push

India is emerging as a top destination for clean energy investment, targeting nearly $300 billion by 2030 and aiming for 5 million metric tons of green hydrogen annually. This transition supports economic growth, cost reduction, and supply-chain opportunities in renewables and green tech.

Supply Chain Realignment and Resilience

US tariffs and sanctions, combined with China’s export controls on critical minerals, are driving a global supply chain realignment. Southeast Asia, Africa, and Latin America are gaining sourcing share, while US firms face higher compliance costs, increased supply chain complexity, and the need for diversification.

Supply Chain Complexity and Disruption

Post-Brexit border controls, customs procedures, and rising transport costs have made UK-EU supply chains more complex and vulnerable to delays. Businesses must invest in compliance, logistics expertise, and route diversification to mitigate risks and maintain trade flow.

Legal Uncertainty Deters Investment

Despite wartime resilience, investors cite unpredictable legal and regulatory frameworks as a greater deterrent than conflict itself. Prolonged legal proceedings and lack of transparency undermine trust, limiting foreign direct investment and complicating contract enforcement.

AI and Technology-Driven Competitiveness

Rapid advances in AI and digitalization are boosting China’s productivity and global influence. The government’s support for tech IPOs and AI adoption is reshaping value chains, but also intensifies competition and export controls, impacting cross-border technology flows and business strategies.

Labor Market Transformation and Data Challenges

Saudi Arabia has doubled women’s labor participation and created 800,000 jobs, but conflicting labor data and rising unemployment rates raise concerns about policy effectiveness and workforce sustainability. Reliable labor statistics are critical for business planning and investment decisions.

Energy Sector Transformation and LNG Imports

Egypt’s declining domestic gas production and unreliable regional supply have shifted it from a gas exporter to a major LNG importer. Record LNG imports, mainly from the U.S., expose Egypt to price volatility and supply risks, while new infrastructure and supply deals seek to stabilize industrial energy needs.

Sanctions-Driven Economic Contraction

Years of sanctions, renewed UN measures, and loss of foreign investment have led to near-stagnant GDP growth (0.6% in 2025), technological lag, and rising poverty. Structural reforms are absent, worsening the long-term outlook for international business engagement.

Resilience Amid US Tariff Pressures

Despite punitive US tariffs in 2024-2025, Brazil achieved record exports of US$348.7 billion in 2025. Diversification toward China, India, and other markets offset losses, but ongoing negotiations with the US and the risk of renewed trade tensions remain critical for exporters and multinationals.

Logistics, Ports, and Infrastructure Strain

Chronic underinvestment and operational challenges in logistics, ports, and transport infrastructure continue to disrupt supply chains. Flight delays, port congestion, and rail bottlenecks undermine export competitiveness and increase costs for international businesses operating in or sourcing from South Africa.

Critical Minerals and Mining Expansion

Saudi Arabia is investing $2.5 trillion in mineral reserves, including rare earths, gold, copper, and lithium, aiming to become a global mining and processing hub. Strategic partnerships with the US, Canada, Brazil, and others are reshaping global supply chains and reducing reliance on China for critical minerals.

Semiconductor and Technology Investment Surge

A landmark US-Taiwan deal commits at least $250 billion in Taiwanese semiconductor investments in the US, with reciprocal tariff reductions to 15%. This aims to boost US tech self-sufficiency, secure supply chains, and reshape the global semiconductor landscape.

Climate Policy and Emissions Targets

Germany met its 2025 climate target but with only a 1.5% emissions reduction. The country risks missing future goals, facing potential €34 billion in emission rights costs, affecting energy-intensive industries and investment in sustainable operations.

Major Infrastructure and Logistics Expansion

Record infrastructure investment, especially in transport and logistics, is transforming states like Uttar Pradesh and Madhya Pradesh into key hubs. Platforms like PRAGATI enable efficient project execution, reducing bottlenecks and enhancing India’s competitiveness as a manufacturing and export base.

Agricultural Sector Crisis and Policy Response

French agriculture faces crisis from low incomes, regulatory burdens, and disease outbreaks. The government announced €300 million in support, import suspensions, and stricter controls, but unrest persists, impacting supply chains and investment confidence in the sector.

Labour Market and Skilled Migration Initiatives

Germany is addressing labour shortages through new mobility and skills agreements, notably with India. Visa facilitation for Indian professionals and expanded vocational training partnerships are designed to attract talent and support economic growth in key sectors.

SME Vulnerability and Regulatory Shifts

SMEs, contributing 35% of GDP, face challenges from new trade regulations, sustainability rules, and limited access to technology. Support for digitalization, green finance, and regional integration is essential to strengthen SME resilience and global supply chain participation.

EU-Mercosur Trade Deal Turmoil

France’s staunch opposition to the EU-Mercosur free trade agreement, driven by agricultural and environmental concerns, has isolated it within the EU. The deal’s likely ratification despite French protests signals rising trade policy uncertainty and supply chain risks for agri-food and related sectors.

Canada-China Trade Normalization and Tariff Reset

Canada and China have reached a landmark agreement to reduce tariffs on electric vehicles and canola, unlocking nearly $3 billion in Canadian exports. This deal signals a thaw in bilateral relations, but risks U.S. retaliation and supply chain realignment, especially in autos and agriculture.

Supply Chain Resilience and Superchain Evolution

China’s supply chain is undergoing rapid digital transformation, leveraging AI, automation, and global logistics networks. This ‘superchain’ approach enhances efficiency and global connectivity, but also increases complexity and dependence on Chinese innovation, impacting global supply chain strategies.