Return to Homepage
Image

Mission Grey Daily Brief - September 11, 2024

Summary of the Global Situation for Businesses and Investors

The global situation remains dynamic, with ongoing geopolitical tensions and economic shifts. Russia's efforts to influence the US elections and its partnership with China in opposition to the Western-led order are key concerns. Libya's political instability and Bangladesh's energy crisis also have regional implications. The EU's joint debt plans and Apple's tax dispute with Ireland are other notable developments.

Russia's Election Interference and China-Russia Alignment

Russia's attempts to sway the 2024 US presidential election in favor of former President Donald Trump have been exposed, leading to sanctions and criminal charges. Meanwhile, China and Russia have announced joint naval and air drills, underscoring their growing alignment against Western-led democratic values. This poses risks to businesses, particularly in the face of potential US retaliation and escalating tensions with the US-led military bloc, NATO.

Risks and Opportunities

  • Risk: Businesses with close ties to Russia or China may face backlash and sanctions from Western countries, especially if associated with supporting authoritarian regimes.
  • Opportunity: Companies can promote their commitment to democratic values and transparency, enhancing their reputation and attracting investors who prioritize ethical practices.

Libya's Political Instability and Reconstruction

Libya continues to face political instability, with military strongman Khalifa Haftar gaining influence through reconstruction efforts in flood-ravaged Derna. The lack of oversight from the internationally recognized government in Tripoli has led to concerns about corruption and political launchpads for Haftar's family.

Risks and Opportunities

  • Risk: Political instability and the influence of military figures in Libya may deter foreign investment, especially in infrastructure projects.
  • Opportunity: There are potential opportunities for companies in the construction and engineering sectors, but due diligence is essential to avoid associations with corrupt practices.

Bangladesh's Energy Crisis and Debt

Bangladesh is facing an energy crisis, with a $3.7 billion power-related debt, including $800 million owed to Adani Power. The interim government, led by Nobel laureate Muhammad Yunus, is seeking financial aid from international bodies like the World Bank. Adani has warned of an "unsustainable" situation, but remains committed to supplying power to Bangladesh.

Risks and Opportunities

  • Risk: Businesses operating in Bangladesh may face disruptions due to the country's energy crisis and financial instability. This could impact production and supply chains.
  • Opportunity: Companies in the energy sector may find opportunities to provide solutions and infrastructure improvements, but should carefully assess the country's financial situation and payment risks.

EU Joint Debt Plans and Apple's Tax Dispute

Mario Draghi, a former head of the European Central Bank, has called for the EU to continue issuing joint debt to finance key investments, but this proposal has faced criticism from fiscally conservative countries like Germany and the Netherlands. Meanwhile, the EU ordered Apple to pay $14 billion in unpaid taxes to Ireland, marking a victory against big tech companies' tax arrangements.

Risks and Opportunities

  • Risk: Businesses operating in the EU may face changing fiscal policies and potential tax reforms, impacting their financial strategies and profitability.
  • Opportunity: Companies can benefit from EU grants and loans offered through the NextGenerationEU program to make critical investments and drive innovation.

Further Reading:

'Unsustainable situation...': Adani Group warns Bangladesh of unpaid $500 million power debt - Business Today

A year on, politics plague rebuilding efforts in Libya’s flood ravaged Derna - FRANCE 24 English

Adani warns Bangladesh of $500 mn 'unsustainable' payment delays as energy crisis looms - The Economic Times

As Russia targets U.S. elections, Trump sees Kremlin as a victim - MSNBC

CIA and MI6 heads discuss Gaza ceasefire efforts, Russian threat in unprecedented joint public appearance in London - CNN

China announces joint naval, air drills with Russia - DW (English)

Draghi report splits German government, receives pushback from Netherlands - EURACTIV

EU orders Apple to pay $14 billion in unpaid taxes to Ireland - BGR

Themes around the World:

Flag

Bond Market Rally and Sovereign Rating Upgrades

Pakistan's dollar bonds have delivered Asia's highest returns in 2025, supported by sovereign rating upgrades and plans to re-enter global debt markets. IMF-backed fiscal discipline and reform momentum underpin investor optimism. However, geopolitical tensions and energy price volatility pose risks to economic growth and public finances, requiring careful fiscal management to maintain market access.

Flag

Consumer Market Resilience and Growth

Vietnam's consumer spending is projected to grow strongly in 2026, supported by rising household incomes, stable inflation, and a tight labor market driving real wage growth. Despite global trade uncertainties and currency depreciation risks, domestic demand remains robust, bolstered by a thriving tourism sector. This consumer strength underpins sustainable economic growth and offers opportunities for businesses targeting the expanding middle class.

Flag

Robust Export Growth Amid Challenges

Vietnam's exports surged over 16% year-on-year to $368 billion by October 2025, driven by electronics and mining sectors. Despite global trade barriers and US tariff hikes, exports remain resilient, though recent cooling signals caution. The country's export structure is fragile, heavily reliant on FDI and imported inputs, facing rising protectionism and sustainability-related trade barriers.

Flag

Currency Exchange Rate Volatility

Fluctuations in the Pakistani rupee against major currencies affect trade competitiveness, inflation, and investment decisions. Exchange rate instability increases uncertainty for importers and exporters, influencing pricing and profit margins. Effective monetary policy and forex market interventions are critical to stabilize the currency and support economic stability.

Flag

Global Monetary Policy Divergence and China’s Deflation

Divergent monetary policies among major economies coincide with China’s slowing GDP growth and persistent deflation, reflecting weak domestic demand and industrial overcapacity. This environment risks enabling China to export cheaper goods, potentially undermining global competitiveness and complicating international trade dynamics amid broader economic uncertainties.

Flag

Non-Oil Sector Growth and Private Sector Expansion

The non-oil private sector in Saudi Arabia is experiencing robust growth, with PMI reaching 60.2 in October 2025. Rising demand, hiring, and business confidence reflect successful diversification efforts. Government initiatives and mega-projects have empowered local companies, increased exports, and reduced oil dependency, strengthening economic resilience.

Flag

Banking Sector Resilience and Financial Soundness

Egypt's banking sector shows robust financial health, with capital adequacy at 18.3% and liquidity ratios exceeding regulatory thresholds. Foreign currency liquidity is ample, supported by rising non-oil exports, tourism, remittances, and FDI. The sector's resilience underpins credit availability and financial intermediation critical for private sector growth and economic stability.

Flag

Geopolitical Tensions in Persian Gulf

Iran's military readiness in the Persian Gulf, especially around strategic islands and the Strait of Hormuz, is heightened amid escalating tensions with the US and Israel. Potential disruptions to this critical energy chokepoint threaten global oil markets, increasing geopolitical risk premiums and affecting international energy supply chains and trade routes.

Flag

Energy Security and International Aid

Ukraine is securing funding and technical assistance from Norway, the EU, and G7 to stabilize energy supplies after Russian attacks on infrastructure. Ensuring heating and electricity stability is critical for economic resilience and business continuity, especially during winter, influencing investor risk assessments and operational planning.

Flag

Rising Oil Exports Despite Sanctions

Iran's crude oil exports have reached a seven-year high of approximately 2 million barrels per day despite renewed UN sanctions. This resilience challenges sanction efficacy, sustains government revenues, and affects global oil supply, presenting complex considerations for international energy markets and trade policies.

Flag

Fiscal Consolidation and Economic Growth

South Africa's Medium-Term Budget Policy Statement (MTBPS) projects a modest economic growth of 1.2% in 2025, improving to 1.8% in the medium term. Fiscal consolidation efforts, including stronger revenue collection and restrained spending, have improved public finances, reduced deficits, and enhanced investor confidence, setting a foundation for sustainable growth and infrastructure investment.

Flag

Shadow Fleet and Sanctions Evasion Tactics

To circumvent sanctions, Russia has expanded its 'shadow fleet' of tankers employing tactics like AIS manipulation, flag hopping, and ship-to-ship transfers to obscure oil origins. This clandestine network complicates enforcement of sanctions, sustains Russian oil exports, and introduces risks and uncertainties for global supply chains and compliance frameworks.

Flag

Commodity Market Influence on Canadian Economy

Rising commodity prices, particularly in gold, copper, and oil, bolster Canada's resource-heavy stock market and provide economic support amid broader market volatility. These commodities underpin key sectors and influence investor sentiment, highlighting Canada's dependence on global demand and price fluctuations for natural resources.

Flag

Illegal Cryptocurrency Mining Crisis

Approximately 95% of Iran's 427,000 crypto mining rigs operate illegally, exploiting subsidized electricity and straining the national power grid. Authorities' crackdown aims to regulate the sector, but widespread illicit activity risks energy shortages and infrastructure instability, complicating economic management and raising concerns for foreign investors in energy and technology sectors.

Flag

Supply Chain Strategic Importance and Governance Gap

The French economy increasingly recognizes supply chain management as a critical strategic function impacting sovereignty and economic resilience. However, France lacks integrated public governance and expertise in supply chain oversight, unlike peers such as the US and Germany, posing risks of costly disruptions and missed opportunities in global trade and industrial competitiveness.

Flag

Security Crisis and Cartel Violence

Mexico faces severe security challenges, highlighted by the assassination of an anti-crime mayor in Michoacán and rising cartel activities. The government’s aggressive security plan combines military deployment and social programs. Persistent violence and organized crime undermine investor confidence, disrupt supply chains, and elevate country risk, with Mexico ranked highest globally in illicit market activity.

Flag

Rare Earth Minerals Potential

Brazil's vast rare earth deposits position it as a potential alternative supplier to China amid global supply chain diversification efforts. However, challenges include limited refining infrastructure, technological gaps, environmental concerns, and political uncertainties. Successful development could enhance Brazil's strategic importance in high-tech industries and attract foreign investment.

Flag

Geopolitical Risk and Economic Fragmentation

Persistent geopolitical risks have transformed the investment landscape, with economic interdependence now weaponized through tariffs and technology restrictions. The US-China relationship is central, driving trade realignments and manufacturing shifts. Investors must adapt to frequent disruptions by diversifying regionally and sectorally, focusing on resilient supply chains and critical minerals to mitigate volatility and capitalize on emerging opportunities.

Flag

Robust Performance of Key Stock Market Sectors

In 2025, Brazil’s stock market surged 28%, led by real estate, essential services, and banking sectors. These sectors benefit from high liquidity, resilience to elevated interest rates, and expectations of rate cuts. Conversely, export-dependent sectors like agribusiness and basic materials underperformed due to currency appreciation and commodity price declines, affecting portfolio allocation strategies.

Flag

Poverty Stagnation and Social Challenges

Economic instability, political turmoil, and climate shocks have halted poverty reduction progress, with rising unemployment and informality undermining social stability. Persistent inequality and inadequate basic services constrain domestic demand and workforce productivity, limiting the potential for inclusive economic growth and sustainable development.

Flag

Robust Export Growth Amid Challenges

Vietnam's exports surged over 16% year-on-year to $368 billion by October 2025, driven by electronics and mining sectors. Despite global trade barriers and US tariff hikes, export momentum remains strong, though cooling signs emerged in October. The export structure's reliance on FDI and imported inputs, alongside rising protectionism and sustainability demands, pose ongoing risks to trade resilience.

Flag

High-Tech Sector Tax Reforms

Israel introduced tax reforms offering benefits and regulatory certainty to attract back tech talent and foreign investments after the Gaza war. The reforms include reduced tax rates on carried interest and VAT exemptions, aiming to reverse the tech brain drain, stimulate startup growth, and sustain the high-tech sector's critical role in GDP and exports.

Flag

Canadian Federal Budget and Fiscal Policy

Prime Minister Mark Carney's first federal budget signals a shift toward expansive fiscal policy with significant deficits to support infrastructure, defense, and clean energy projects. This approach aims to counteract monetary policy limits and structural economic challenges, influencing investor confidence and long-term economic growth prospects.

Flag

Energy Transition and Nuclear Power Debate

Despite pioneering Danish companies developing small modular nuclear reactors, Denmark maintains a ban on nuclear power, limiting domestic energy diversification. The debate centers on balancing climate goals, energy security, and environmental concerns, with potential implications for future energy investments and technological leadership in clean energy.

Flag

Robust Capital Market Growth and Liquidity

Indonesia's stock market saw record daily transaction values of Rp25.06 trillion in October 2025, with the Indonesia Composite Index (IHSG) achieving all-time highs. The number of capital market investors reached over 19 million, driven by increased participation from younger demographics. This growth enhances market depth but also requires vigilant regulatory oversight to sustain investor confidence.

Flag

Impact of Chinese Rare Earth Export Controls

China's export restrictions on rare earth minerals pose indirect risks to Taiwan's semiconductor production. TSMC mitigates exposure through diversified sourcing and stockpiles, but supply chain disruptions and cost increases remain concerns. The broader geopolitical tension over critical minerals underscores Taiwan's vulnerability and the need for supply chain diversification in high-tech manufacturing.

Flag

Challenges in Taiwan's New Southbound Policy

Taiwan's strategic pivot to Southeast Asia under the New Southbound Policy aims to reduce China dependence but faces hurdles including US tariffs, Beijing's regional influence, and local investment preferences. Taiwanese firms encounter higher costs and competitive pressures in ASEAN markets, complicating supply chain diversification and regional integration efforts amid evolving geopolitical and trade dynamics.

Flag

Disrupted Global Wheat Supply

Ukraine's war has severely disrupted its wheat production and exports, a critical global supply source. Damaged infrastructure, mined fields, and uncertain Black Sea shipping routes have reduced exports, pushing global wheat markets into volatility. This impacts food security worldwide, raising prices and supply risks, especially for import-dependent regions like the Caribbean.

Flag

Economic Recovery and Tourism Rebound

After a Q3 slowdown, Thailand's economy showed recovery signs in September 2025, fueled by manufacturing growth, rising exports, and increased foreign tourism, especially from Malaysia and India. Domestic demand remains weak, and US tariffs affect exports, but stable labor markets and trade surpluses support ongoing recovery efforts.

Flag

US Reciprocal Tariffs Impacting Exports

The US's reciprocal tariff policy is projected to slow Thailand's GDP growth to 1.7% in 2026, affecting a large share of exports under Section 232. While exporters currently absorb cost pressures, eventual consumer price increases may weaken export competitiveness, compelling businesses to innovate and diversify markets to mitigate tariff-related risks.

Flag

Global Investment Hub Emergence

Saudi Arabia is positioning itself as a global investment hub, evidenced by a 24% increase in foreign direct investment to $31.7 billion in 2024. Hosting the Future Investment Initiative with over 8,000 participants, the Kingdom attracts major global financial institutions, reinforcing its role as a bridge between global capital and Middle Eastern markets, enhancing trade and investment opportunities.

Flag

Economic Instability and Inflation Crisis

Pakistan faces persistent economic challenges including rising inflation, fuel price hikes, and fragile currency stability. Inflation surged to 6.2% in October 2025, driven by supply shocks and policy inconsistencies, straining household budgets and increasing operational costs for businesses. This inflationary environment undermines purchasing power, disrupts supply chains, and deters investment due to cost uncertainties.

Flag

Semiconductor Industry Innovation Hub

Israel's semiconductor sector, powered by startups and multinational R&D centers, sustains global chip innovation with venture capital investment ratios three times the national average. This dual-engine model positions Israel as a critical player in global supply chains amid shifting geopolitical and technological landscapes.

Flag

Monetary Policy and Economic Outlook

The Bank of Canada has cut interest rates to 2.25% to support a slowing economy affected by trade disruptions and weak business investment. Monetary policy is constrained in addressing sector-specific shocks, shifting the burden to fiscal measures. Economic growth forecasts remain modest, reflecting structural adjustments and global uncertainties.

Flag

Taiwan's Financial Market Resilience

Taiwan's stock market shows strong performance with rising indices and increased dividends in high-yield ETFs, fueled by technology sector gains and AI demand. This resilience attracts international investors but remains sensitive to geopolitical and economic uncertainties.

Flag

Business Risks in Ukraine

Ukrainian entrepreneurs identify four key risks: energy supply and pricing, labor shortages due to migration and mobilization, growth of the shadow economy estimated at 500 billion UAH, and unstable legislative environment. Despite these challenges, over 70% of companies expect revenue growth, with many planning business expansion and investment, reflecting cautious optimism amid adversity.