Mission Grey Daily Brief - November 15, 2024
Summary of the Global Situation for Businesses and Investors
The world is witnessing a series of geopolitical and economic events that could have significant implications for businesses and investors. Pakistan and Bangladesh are taking steps to improve their diplomatic relationship, which could open up new business opportunities in the region. Meanwhile, tensions between Israel and other countries are escalating, with airstrikes in Syria and violence at a football match in Amsterdam. In Sudan, the discovery of French weapons systems has raised concerns about a potential violation of a U.N. arms embargo. Additionally, China's hacking of America's telecommunication system and efforts to court G20 nations to circumvent Western sanctions in a potential Taiwan conflict are significant developments that could impact global supply chains and geopolitical alliances.
Pakistan-Bangladesh Relations
The arrival of a Pakistan cargo vessel in Bangladesh marks a historic moment in the diplomatic relationship between the two countries, which has been traditionally complex since the 1971 Bangladesh Liberation War. The docking of the vessel in Bangladesh's Chittagong port is the first-ever direct maritime contact between the two countries and signals a warming of ties under the new interim government led by Mohammad Yunus. This shift in relations could have significant implications for businesses and investors, as it opens up new opportunities for bilateral trade and investment. The new route will streamline supply chains, reduce transit time, and create new business opportunities for both countries.
Israel-France Relations
France has stepped up security for the national football team's match against Israel on Thursday to avoid a repeat of the violence in Amsterdam, where five people were hospitalised during a trip to play Ajax. The match is considered high-risk due to the tense geopolitical context and the presence of prominent political figures. Only about 20,000 fans are expected in the 80,000-seat stadium after Israel urged its citizens to avoid attending sporting and cultural events abroad following the violence in Amsterdam. This escalation in tensions could have implications for businesses and investors with interests in the region, as it highlights the need for increased security measures and the potential for further disruptions to public order.
Sudan Civil War
Amnesty International has reported the presence of French weapons systems in Sudan, which likely constitutes a violation of a U.N. arms embargo. The civil war in Sudan has resulted in over 20,000 deaths and 11.6 million people being forcibly displaced. The discovery of French weapons systems raises concerns about the potential violation of international law and the role of foreign governments in the conflict. This development could impact businesses and investors with interests in the region, as it highlights the ongoing instability and the potential for further international involvement.
China-US Relations
China's hacking of America's telecommunication system and efforts to court G20 nations to circumvent Western sanctions in a potential Taiwan conflict are significant developments that could impact global supply chains and geopolitical alliances. The breaches enabled the theft of customer call records data and the compromise of private communications of a limited number of individuals in government or political activity. This cyber espionage campaign could have far-reaching consequences for businesses and investors, as it undermines trust in the security of telecommunications systems and raises concerns about the potential for further cyber attacks.
Conclusion
The global events highlighted in this report demonstrate the complex and interconnected nature of global politics and economics. Businesses and investors should remain vigilant and proactive in managing risks and capitalizing on opportunities in this ever-changing global landscape.
Further Reading:
Biden and Xi will meet in Peru as US-China relations tested again by Trump’s return - Toronto Star
China to court G20 nations amid US-led sanctions over Taiwan: report - South China Morning Post
Facing Trump’s return, South Korea tees up for alliance strains - VOA Asia
France steps up security for Israel match after Amsterdam violence - The Independent
NATO and the EU press China to help stop North Korea’s support for the war on Ukraine - Toronto Star
Türkiye halts trade in strong response to Israel’s attacks on Gaza | Daily Sabah - Daily Sabah
Türkiye’s ‘diplomatic excellence’ could help Trump end wars: Economist | Daily Sabah - Daily Sabah
Themes around the World:
Inflation and Macroeconomic Stabilization
Egypt's inflation rate eased slightly to 10.1% in October 2025 amid ongoing price pressures, particularly in food, housing, and utilities. Macroeconomic reforms, including a flexible exchange rate and fiscal consolidation, have begun stabilizing the economy, enhancing competitiveness, and restoring investor confidence, which are critical for sustainable growth and trade competitiveness.
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.
Economic Fragmentation and Portfolio Diversification
The global economic landscape is shifting from globalization to fragmentation, with rising trade barriers and geopolitical shocks. Traditional portfolio diversification is less effective as equities and bonds move in tandem. Investors are increasingly seeking resilience through regional diversification, private markets, commodities, and scenario analysis to mitigate risks from geopolitical, climate, and pandemic disruptions.
US Dollar and Currency Market Dynamics
The US Dollar exhibits mixed performance influenced by risk sentiment shifts, government shutdown negotiations, and economic data delays. Safe-haven flows and currency volatility affect international trade costs and investment returns, with implications for multinational corporations and forex traders navigating uncertain macroeconomic conditions.
Rare Earth Export Controls
China's tightening of rare earth export restrictions threatens European manufacturing and technology sectors reliant on these critical minerals. Given China's dominance in rare earth supply chains, these controls risk disrupting clean energy, defense, and high-tech industries in Europe, intensifying geopolitical tensions and accelerating efforts to diversify supply sources and develop domestic capabilities.
Global Market Interconnections and Spillover Risks
The UK market remains sensitive to global financial shocks, including potential US stock market corrections and international trade tensions. Defensive sectors and currency depreciation may mitigate some risks, but interconnectedness demands vigilant portfolio diversification and risk management strategies.
Trade Tensions and Tariffs Impact
Ongoing U.S.-Canada trade tensions, including tariffs on steel, aluminum, autos, and lumber, are disrupting supply chains and depressing exports. These frictions have led to reduced business investment and economic uncertainty, compelling Canada to diversify trade partners and reconfigure supply chains, which affects international trade dynamics and investment strategies.
E-Commerce Logistics Market Expansion
Thailand's e-commerce logistics market, valued at USD 2 billion in 2025, is rapidly expanding due to rising online retail penetration and demand for same-day delivery. Government initiatives like 'Thailand 4.0' drive digitalization and automation in logistics. Investments by major players and infrastructure modernization position Thailand as a regional e-commerce hub, enhancing supply chain efficiency and cross-border trade within ASEAN.
Business Sentiment and Sectoral Performance
Business confidence in France shows modest improvement driven by the service sector, though industrial indicators remain mixed. This uneven recovery suggests a moderate economic trajectory influenced by fiscal tightening and global geopolitical tensions.
M&A Activity Driven by Rising FDI
Robust FDI inflows have catalyzed a surge in mergers and acquisitions, particularly in Ho Chi Minh City, which attracted $7.3 billion in FDI. Administrative reforms reducing procedural delays have accelerated deal-making, with significant transactions in renewable energy and strategic sectors. Foreign investors from Japan, Korea, and Europe remain active, signaling confidence in Vietnam's investment climate.
Media Freedom Constraints
Turkey's media landscape faces significant government control through takeovers, regulatory pressure, and criminal prosecutions, limiting press freedom. This environment creates operational risks for businesses reliant on transparent information flows and may affect Turkey's international reputation, investor confidence, and the broader socio-political stability critical for economic activity.
Stock Market Rally and Volatility Risks
The KOSPI index has surged over 70% in 2025, driven by tech and AI optimism, but rising margin loans and retail investor leverage heighten volatility risks. The VKOSPI volatility index spiked to 44, signaling market sensitivity. Regulatory concerns focus on speculative borrowing and potential for a policy-driven bubble, posing risks to financial stability and investor confidence.
Taiwan's Push for Domestic Critical Materials Production
In response to China-US trade frictions and supply chain disruptions, Taiwan is accelerating efforts to develop domestic production of essential materials like rare earth elements and neon gas. This strategic move aims to secure supply chains for high-tech industries, reduce external dependencies, and enhance resilience amid geopolitical uncertainties.
Robust Crypto Market Growth
PT Indokripto Koin Semesta Tbk achieved a 19-fold revenue increase in 2025, driven by surging crypto asset transactions, especially derivatives which grew 118% in Q3. This reflects growing consumer confidence and innovation in Indonesia's crypto sector, presenting new investment opportunities and signaling a maturing digital asset market with implications for fintech and regulatory frameworks.
Weak Business Sentiment and Policy Confidence
Business confidence remains low with only 15% of firms expecting economic improvement and 56% citing labor costs as a major risk. Confidence in government economic policy is waning due to perceived inaction on reforms, bureaucracy, and cost controls. This dampens investment and hiring, impacting Germany’s attractiveness for foreign and domestic investors and slowing economic recovery.
Regional Influence and Proxy Dynamics in Iraq
Iran's regional influence hinges critically on Iraq's parliamentary elections, with outcomes affecting Tehran's control over proxies and strategic footholds. Fragmentation among Shiite factions and US pressure to disarm militias threaten Iran’s leverage. These developments bear on regional security, economic access, and Iran's capacity to project power, influencing geopolitical risk assessments.
China’s Rare Earth Export Controls
China’s tightening of rare earth export controls threatens European manufacturing and technology sectors reliant on critical minerals for EVs, defense, and clean energy. With China dominating 80% of global rare earth supply, these restrictions heighten supply chain vulnerabilities, escalate trade tensions, and compel Europe to accelerate domestic sourcing and diversify supply chains.
Export Growth Driven by Manufacturing
Exports reached US$209.8 billion by September 2025, up 8.14% YoY, with non-oil and gas exports growing 9.57%. Key contributors include palm oil, non-iron base metals, jewelry, chemicals, and electronics. This diversification enhances Indonesia's trade resilience and competitiveness, affecting supply chain configurations and export-oriented investments.
Security Crisis and Government Response
The assassination of an anti-crime mayor in Michoacán triggered a major security plan combining military deployment and social programs. While homicide rates reportedly declined nationally, persistent violence in key states challenges investor confidence and political stability, influencing risk assessments for businesses operating in Mexico.
US-China Financial Interdependence Risks
Chinese state banks have funneled billions in hidden loans to US companies, including strategic sectors like robotics and semiconductors. This covert financial interdependence raises national security concerns and complicates US-China trade relations, potentially impacting investment strategies and regulatory scrutiny in sensitive industries.
Ukrainian Diaspora Economic Contributions
Ukrainian-American businesses generate approximately $60 billion annually and support 300,000 US jobs, particularly in technology and agriculture. This diaspora-driven economic activity fosters innovation, sustains bilateral economic ties, and provides a financial lifeline that indirectly supports Ukraine's broader economic resilience during the conflict.
Government Market Support and Political Influence
The South Korean government actively promotes stock market growth, targeting a KOSPI index of 5,000. Political parties politicize market movements, and officials have controversially endorsed leveraged investing. While aiming to channel capital from real estate to equities, such interventions risk inflating valuations and encouraging speculative behavior, complicating market stability.
Foreign Investment Surge and Regulatory Reforms
Saudi Arabia's overhaul of investment laws in 2025 simplified foreign business entry, removed sector-specific licenses, and opened real estate to foreign ownership. This regulatory modernization, combined with Vision 2030 projects, has attracted significant foreign direct investment, especially from UAE and Indian companies, enhancing economic diversification and bilateral trade.
Transparency and Public Access to ART Documents
The Malaysian government has made ART documents publicly accessible on the MITI website, including FAQs addressing public concerns. This transparency effort aims to build trust, counter misinformation, and facilitate informed discourse among stakeholders, enhancing governance and accountability in trade negotiations.
Energy Reserves and Transition Strategy
Indonesia holds substantial oil, condensate, and natural gas reserves, with natural gas playing a pivotal role in energy security and cleaner energy transition. Government initiatives focus on exploration, infrastructure expansion, and regulatory reforms to attract investment, shaping the energy sector's future and related supply chains.
EU Accession Progress and Governance Challenges
Ukraine has made notable progress in EU accession negotiations, advancing reforms in public administration and democratic institutions. However, persistent issues such as corruption, political pressure on anti-corruption bodies, judicial independence concerns, and civil society harassment pose significant risks to sustained international support and integration prospects.
Energy Sector Investment and Offshore Exploration
Pakistan is revitalizing its energy sector with bids for 23 offshore oil blocks, involving major local and Turkish firms, aiming to reduce energy import dependence. However, significant investment of up to $5 billion is required amid security risks and political instability. Energy infrastructure development is critical for economic stability but remains vulnerable to geopolitical and domestic challenges.
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.
Currency Volatility Risks
Turkey's foremost business risk in 2025 is currency exchange rate volatility, impacting 73.3% of companies. This instability elevates operational costs and complicates financial planning, posing significant challenges for international trade and investment strategies. Managing currency risk is critical for sustaining business resilience amid economic uncertainties and geopolitical fluctuations.
Corporate Risk Management and Cybersecurity Challenges
Indian firms face escalating risks from cyber threats, economic volatility, regulatory pressures, and talent shortages. Despite awareness, few quantify exposures or leverage analytics for risk mitigation. Enhanced focus on adaptive risk management, digital resilience, and data-driven strategies is critical for sustaining competitiveness and managing operational and financial vulnerabilities in a complex risk environment.
Geopolitical Uncertainty and US Policy Shifts
The US exhibits a volatile stance on Ukraine, balancing military aid with diplomatic engagement with Russia. This strategic ambiguity, coupled with pressure on European allies to assume greater responsibility, creates uncertainty for Ukraine's security environment and complicates long-term investment and trade planning.
Nuclear Ambitions vs. Domestic Needs
Iran's prioritization of nuclear and military ambitions over addressing critical domestic shortages, including water and energy, highlights governance challenges. This imbalance fuels public discontent and raises questions about regime stability, impacting the investment climate and international diplomatic relations.
Transport Corridors as Geopolitical Tools
Russia leverages Eurasian transport corridors as geopolitical instruments to consolidate freight flows, reduce logistics costs, and enhance regional influence. These corridors support economic activity and diversification of trade routes, impacting global supply chains and offering strategic leverage in Eurasian trade dynamics.
Political Instability and Market Volatility
The potential resignation of key political figures like Rachel Reeves is creating significant uncertainty in the UK market. Such political instability threatens investor confidence, triggers policy ambiguity, and could lead to sharp market sell-offs and bond market turmoil. This instability complicates fiscal policy predictability, impacting international investment strategies and currency stability.
Emerging Tech M&A and Digital Transformation
Vietnam's technology sector sees a resurgence in mergers and acquisitions, focusing on AI, semiconductors, fintech, and digital infrastructure. Strategic deals by global and local players signal a shift towards building comprehensive tech ecosystems. This trend aligns with Vietnam's digital transformation goals and positions the country as a competitive hub for innovation-driven growth through 2028.
Trade Policy Divergence and Protectionism
Mexico is adopting a more protectionist stance toward China while striving to maintain free trade within North America. This strategic divergence reflects geopolitical shifts and impacts Mexico’s trade diversification, supply chain realignments, and foreign investment patterns, with implications for global trade flows and Mexico’s economic partnerships.