Critical Minerals and Resource Security

Canada’s vast reserves of critical minerals and natural resources have become a focal point in US-Canada tensions. Control over these assets is now central to national security and industrial policy, affecting global supply chains for energy, technology, and manufacturing sectors.

Vision 2030 Economic Transformation

Saudi Arabia’s Vision 2030 drives diversification beyond oil, fostering rapid growth in non-oil sectors, digital innovation, and foreign investment. This transformation reshapes market opportunities, regulatory frameworks, and competitive dynamics for international businesses.

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.

Cybersecurity Regulation and Critical Infrastructure Protection

Israel is advancing comprehensive cyber legislation, expanding reporting and compliance requirements for critical sectors. With the country among the most targeted globally, these measures aim to enhance national resilience and safeguard business operations, particularly in tech, energy, and logistics.

Energy Supply and Cost Pressures

Delays in domestic gas production and reliance on expensive LNG imports have increased energy costs for industry. Pending petroleum law reforms and the need for clean energy to support new sectors, like data centers, are critical for operational planning and cost management.

Current Account Deficit and Financing

Brazil’s current account deficit reached US$68.8 billion in 2025 (3.02% of GDP), financed mainly by long-term foreign investment. While trade balances remain positive, deficits in services and primary income require ongoing capital inflows to sustain external stability.

Export-Led Growth Amid Weak Demand

China’s 2025 growth was driven by record exports and a $1.2 trillion trade surplus, offsetting a 20% drop in US-bound shipments. However, domestic demand remains subdued due to a prolonged property crisis and weak consumer confidence, raising sustainability concerns.

Immigration Policy and Labor Market Volatility

Australia's high immigration rate—31.5% foreign-born—fuels economic growth but also political debate amid cost-of-living and housing crises. Rising populist rhetoric and calls for policy reform create uncertainty for workforce planning, talent mobility, and social stability, affecting business operations and investment climate.

Rising Regional Geopolitical Influence

Saudi Arabia is recalibrating its foreign policy, forming new defense alliances with Egypt, Turkey, and Pakistan, and asserting itself in Yemen and the Horn of Africa. This shift increases regional autonomy but also introduces new risks and uncertainties for international business operations.

Escalating Cross-Strait Geopolitical Risks

China’s increased military pressure, including frequent air and naval incursions, raises the risk of conflict and supply chain disruption. Heightened tensions threaten business continuity, insurance costs, and regional stability, making contingency planning essential for international firms.

Labor Mobility and Skills Partnerships

Germany is expanding labor mobility agreements, especially with India, to address skilled labor shortages. Visa facilitation, joint education initiatives, and skilling partnerships are expected to ease talent flows, benefiting sectors such as healthcare, IT, and advanced manufacturing.

Coal Phase-Out Delays and Grid Reliability

The planned closure of major coal power stations, such as Eraring, has been delayed to 2029 to support grid reliability during the energy transition. This extension reflects market uncertainties and underscores the challenges of balancing decarbonization goals with energy security for business operations.

USMCA Uncertainty and Trade Policy

The 2026 USMCA review introduces significant uncertainty for Mexico’s trade and investment climate. Potential renegotiation or non-renewal, new US tariffs, and stricter rules of origin could disrupt supply chains, especially in automotive, manufacturing, and critical minerals, impacting cross-border operations and investment planning.

Domestic Reforms and Infrastructure Investment

Canada is fast-tracking $1 trillion in investments across energy, AI, critical minerals, and trade corridors, alongside tax reforms and interprovincial trade liberalization. These initiatives aim to boost competitiveness and supply chain resilience, presenting significant opportunities for global investors.

Persistent National Security and Human Rights Concerns

Despite renewed economic engagement with China, Canada faces ongoing challenges around foreign interference, technology transfer, and human rights. These issues influence investment screening, regulatory compliance, and reputational risk for international firms in sensitive sectors.

US-China Trade Tensions Escalate

Ongoing tariff increases and retaliatory measures have sharply reduced US-China trade, with US imports from China down 28% and exports down 38% in 2025. This realignment is driving supply chain diversification and impacting global trade flows.

Supply Chain Resilience and Market Access Volatility

Recent tariff disputes and retaliatory measures have highlighted vulnerabilities in Canada’s supply chains, especially in agri-food and automotive sectors. Businesses must adapt to ongoing volatility in market access, regulatory environments, and bilateral relations with both the U.S. and China.

Divergent Energy Transition Strategies

The US is prioritizing fossil fuel expansion and rolling back clean energy incentives, while China and the EU accelerate renewables. This divergence risks ceding global clean-tech leadership to China, impacting long-term competitiveness and investment flows.

Massive International Financial Support Packages

The EU and US are advancing unprecedented financial support for Ukraine, including a €90 billion EU loan and an $800 billion US-backed recovery package. These funds aim to stabilize Ukraine’s economy and support reconstruction, but their disbursement and effectiveness depend on political consensus and conflict resolution.

Full Liberalization of Capital Markets

Saudi Arabia’s abolition of the Qualified Foreign Investor regime and opening of its equity market to all foreign investors from February 2026 marks a historic liberalization. This reform is expected to unlock $10 billion in inflows, deepen liquidity, and enhance Saudi Arabia’s integration into global indices, but regulatory clarity and governance standards remain critical for long-term investor confidence.

Political Risk and 2026 Election Uncertainty

Brazil’s presidential election in October 2026 is a major source of uncertainty for investors. Market sentiment is sensitive to potential shifts in economic policy, fiscal reforms, and institutional stability, with volatility expected in currency and asset prices as the election approaches.

Energy Transition and Industrial Competitiveness

Germany is accelerating its energy transition by phasing out coal, building new gas plants, and subsidizing industrial power prices. While aiming for climate goals, the high cost of the transition and energy security concerns are prompting significant government intervention to support energy-intensive industries.

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.

Political Instability and Budget Deadlock

France faces acute political instability as the government struggles to pass the 2026 budget, risking no-confidence votes and potential snap elections. This uncertainty undermines investor confidence, complicates fiscal planning, and could affect France’s credit rating and business environment.

Political Stability and Policy Continuity

India’s stable democratic institutions, policy continuity, and macroeconomic management underpin investor confidence. The government’s commitment to infrastructure, digital public goods, and inclusive growth ensures a predictable environment for international business and investment decisions.

Drone Strikes Disrupt Supply Chains

Ukrainian drone and missile attacks on Russian refineries and infrastructure in 2025 caused a 25% drop in energy income and the lowest refinery deliveries since 2010. These disruptions threaten supply reliability and raise operational risks for businesses dependent on Russian energy.

Labor Market and Demographic Dynamics

Vietnam’s young, growing workforce underpins its manufacturing competitiveness. However, wage pressures, skills shortages, and the need for digital upskilling are emerging challenges. Labor market reforms and social stability are essential for maintaining cost advantages and attracting long-term investment.

Accelerating Supply Chain Diversification

Vietnam is rapidly emerging as a preferred hub for high-value electronics manufacturing, with global firms like Google and Apple relocating advanced production and engineering processes from China. This shift is driven by geopolitical tensions, U.S. tariffs, and the need for resilient, independent supply chains, positioning Vietnam at the center of global value chains.

Supply Chain Realignment and Resilience

Recent trade frictions and export controls, especially involving the US, China, and Japan, are driving South Korea to diversify supply chains and pursue trilateral cooperation. This realignment is critical for mitigating risks in high-tech manufacturing and maintaining global market access.

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.

Geopolitical Uncertainty and Global Realignment

US trade unpredictability is prompting major economies like Germany, India, and Canada to diversify trade ties and reduce reliance on American markets. German investment in China surged 55% in 2025, and India finalized a landmark EU deal after US talks collapsed. This realignment is fragmenting global trade frameworks, increasing the complexity of cross-border investment and supply chain strategies.

Organized Crime and Investment Risk

Persistent organized crime and cartel activity, especially in key states like Michoacán, continue to pose operational and security risks. Despite increased arrests and bilateral cooperation, extortion, violence, and supply chain disruptions remain significant concerns for international investors.

Commodity Export Competitiveness

South Africa’s strategic mineral and agricultural exports benefit from global rediversification and commodity demand, but are constrained by domestic logistics, policy uncertainty, and rising input costs, impacting trade balances and sectoral investment strategies.

Regional Integration and Trade Bloc Leverage

South Africa leverages its role in the African Continental Free Trade Area and regional infrastructure to position itself as a gateway to Africa. This enhances supply chain diversification and trade opportunities, but also requires continued investment in logistics and regulatory harmonization.

Energy Security and Infrastructure Deals

A new 15-year gas agreement with Azerbaijan and major investments in natural gas and renewables are central to Turkey’s drive for energy security and reduced import dependency. These moves enhance industrial competitiveness and supply chain resilience.

Supply Chain Resilience and Diversification

Japan’s government and industry are accelerating efforts to diversify supply chains for critical minerals, semiconductors, and pharmaceuticals. Recent G7-led initiatives and domestic innovation aim to reduce strategic vulnerabilities exposed by geopolitical shocks and export controls.