Mission Grey Daily Brief - January 08, 2025
Summary of the Global Situation for Businesses and Investors
The global situation is marked by geopolitical tensions and potential conflicts that could have significant implications for businesses and investors. Donald Trump's refusal to rule out military action to acquire the Panama Canal and Greenland has raised concerns about the potential disruption of global supply chains and increased tensions with China. Meanwhile, China's deployment of a "monster" coast guard vessel near the Philippines has led to a diplomatic standoff and raised questions about China's intentions in the region. In North Korea, Kim Jong Un's announcement of an improved hypersonic missile has heightened tensions and raised concerns about the country's nuclear capabilities. Additionally, the US's imposition of sanctions on Sudan's Rapid Support Forces (RSF) and its leader, Mohamed Hamdan Dagalo, for genocide and war crimes has further strained relations and highlighted the ongoing humanitarian crisis in the region.
Donald Trump's Aggressive Foreign Policy and its Implications for Businesses and Investors
Donald Trump's refusal to rule out military action to acquire the Panama Canal and Greenland has raised concerns about the potential disruption of global supply chains and increased tensions with China. The Panama Canal is a critical artery for global commerce, linking the Pacific and Atlantic Oceans and facilitating the movement of goods between Asia and the US. Any disruption to its operations could have significant implications for businesses and investors, particularly those reliant on supply chains that pass through the canal.
Trump's comments about the Panama Canal and his willingness to use military force to acquire it have raised concerns about the potential for increased tensions with China, which has a significant presence in the region. This could have implications for businesses and investors with interests in the region, as well as those reliant on supply chains that pass through the canal.
Trump's aggressive foreign policy and refusal to rule out military action have raised concerns about the potential for increased tensions and disruption of global supply chains. Businesses and investors should monitor the situation closely and consider the potential implications for their operations and supply chains.
China's Deployment of a "Monster" Coast Guard Vessel and its Implications for Businesses and Investors
China's deployment of a "monster" coast guard vessel near the Philippines has led to a diplomatic standoff and raised questions about China's intentions in the region. The 12,000-ton patrol vessel, CCG-5901, is three times the size of the US coast guard's main patrol vessels and is armed with anti-aircraft guns and fuel storage capacities, making it suitable for extended missions.
The Philippines has accused China of intimidation and has deployed its own air and sea assets in response to the Chinese vessel's presence. This has led to a diplomatic standoff and raised questions about China's intentions in the region.
The situation between China and the Philippines is part of a larger pattern of tensions in the South China Sea, where China has been increasingly assertive in asserting its territorial claims. This has implications for businesses and investors with interests in the region, as well as those reliant on supply chains that pass through the South China Sea.
Businesses and investors should monitor the situation closely and consider the potential implications for their operations and supply chains. They should also be prepared for potential disruptions to supply chains and increased tensions in the region.
North Korea's Improved Hypersonic Missile and its Implications for Businesses and Investors
North Korea's announcement of an improved hypersonic missile has heightened tensions and raised concerns about the country's nuclear capabilities. The missile is an upgraded version of its solid-fuel hypersonic intermediate-range ballistic missile (IRBM), which North Korea claims is meant to improve its nuclear weapons capabilities.
The announcement has raised concerns about North Korea's intentions and its potential to threaten regional stability. This has implications for businesses and investors with interests in the region, as well as those reliant on supply chains that pass through the region.
Businesses and investors should monitor the situation closely and consider the potential implications for their operations and supply chains. They should also be prepared for potential disruptions to supply chains and increased tensions in the region.
US Sanctions on Sudan's Rapid Support Forces and its Implications for Businesses and Investors
The US's imposition of sanctions on Sudan's Rapid Support Forces (RSF) and its leader, Mohamed Hamdan Dagalo, for genocide and war crimes has further strained relations and highlighted the ongoing humanitarian crisis in the region. The sanctions bar Dagalo and his family from travelling to the US and freeze any US assets he might hold.
The sanctions have also targeted seven RSF-owned companies located in the United Arab Emirates and one other person for their roles in procuring weapons for the RSF. This has implications for businesses and investors with interests in the region, as well as those reliant on supply chains that pass through the region.
Businesses and investors should monitor the situation closely and consider the potential implications for their operations and supply chains. They should also be prepared for potential disruptions to supply chains and increased tensions in the region.
Further Reading:
Before Trump scoops up Canada, he’s eyeing up Greenland: Watters - Fox News
Kim Jong Un says ‘world cannot ignore’ North Korea’s improved hypersonic missile - NK News
Philippines raises alarm over ‘monster’ Chinese vessel near its waters - The Independent
Trump will not rule out using military force to take Panama Canal, Greenland - FRANCE 24 English
Trump’s Panama gambit spurs controversy - Mail and Guardian
US determines Sudan’s RSF committed genocide, imposes sanctions on leader - Sight Magazine
Vladimir Putin’s wobbly empire gives US a path to stifle Russia’s threats - New York Post
Themes around the World:
Data regulation tightening under DUAA
Most provisions of the UK Data (Use and Access) Act entered into force, expanding ICO powers and enabling fines up to £17.5m or 4% of global turnover under PECR. Multinationals face higher compliance costs for AI, marketing, and cross‑border data operations.
China’s export-led surplus pressures partners
Europe’s 2025 goods deficit with China widened to €359.3bn as EU imports rose 6.3% and exports fell 6.5%. Persistent Chinese overcapacity and weak domestic demand increase dumping allegations, trade remedies, and localization pressure for multinationals competing with subsidized Chinese champions.
Nuclear talks uncertainty and snapback
Muscat talks resumed but remain far apart on enrichment and scope, while sanctions continue alongside diplomacy. The risk of negotiation breakdown—or further UN/EU/U.S. “snapback” measures—creates unstable planning horizons for contracts, project finance, and long-cycle investments in Iran-linked trade.
Baht strength, FX intervention bias
Foreign inflows after the election are strengthening the baht, while the Bank of Thailand signals willingness to manage excessive volatility and scrutinize gold-linked flows. A stronger currency squeezes exporters’ margins and complicates regional supply-chain cost planning and hedging strategies.
Secondary sanctions via tariffs
New executive authority threatens ~25% additional tariffs on imports from countries trading with Iran, alongside expanded “shadow fleet” designations. This blurs sanctions and trade policy, raising counterparty screening demands, shipping/insurance costs, and retaliation risk for firms operating across US-linked markets.
Logistics hub push via ports
Mawani ports handled 8.32m TEUs in 2025 (+10.6% YoY) and 738k TEUs in January (+2.0%), with transshipment up 22.4%. Port upgrades (e.g., Jeddah) aim to capture rerouted Red Sea traffic and reduce landed-cost volatility.
Deterioração fiscal e dívida
Gastos cresceram 3,37% acima do limite real de 2,5% do arcabouço em 2025, elevando o déficit para 0,43% do PIB e a dívida bruta para 78,7% do PIB; projeções apontam 83,6% até 2026. Pressiona juros e risco-país.
Border and neighbor-country trade disruptions
Thai-Cambodian tensions and Myanmar instability create episodic border closures, rerouting costs, and inventory risk for agribusiness and manufacturers. Myanmar’s reduced FX conversion requirement (15%) may help liquidity, but security and import controls still threaten cross-border trade reliability.
Labour shortages, migration recalibration
Mining, infrastructure and advanced manufacturing face persistent skills shortages; industry is pushing faster skilled-migration pathways while government tightens integrity and conditions in some visa streams. Project schedules, wage costs and compliance burdens are key variables for investors and EPC firms.
Oil pricing and OPEC+ discipline
Saudi Aramco’s repeated OSP cuts for Asia, amid Russian discounts and global surplus concerns, signal tougher competition and market-share defense. Energy-intensive industries should plan for higher price volatility, changing refining margins, and potential policy-driven output adjustments within OPEC+.
Параллельный импорт и серые каналы
Поставки санкционных товаров продолжаются через третьи страны. Пример: десятки тысяч авто западных брендов поступают через Китай как «нулевой пробег, б/у», обходя ограничения; в 2025 почти половина ~130 тыс. таких продаж в РФ была произведена в Китае. Комплаенс усложняется.
Tax uncertainty and retrospective levies
Court-backed ‘super tax’ recoveries (around Rs310bn) and concerns over retroactive application undermine predictability. Firms face higher effective tax burdens, potential disputes and arbitration risk. This dampens FDI appetite and encourages short-horizon, defensive capital allocation.
Cybersecurity and data regulation tightening
Rising cyber and foreign-interference concerns are driving stricter critical-infrastructure security expectations and data-governance requirements. Multinationals should anticipate higher compliance costs, vendor-risk audits, and incident-reporting duties, influencing cloud sourcing, cross-border data flows, and M&A diligence.
State-led investment via Danantara
Danantara is centralizing SOE assets and launching about US$7bn in downstream “hilirisasi” projects, while signaling possible market interventions and strategic acquisitions. The model can accelerate infrastructure and processing capacity, but raises governance, competition, and expropriation-perception risks for foreign partners.
Aerospace certification dispute escalation
A U.S.–Canada aircraft certification dispute triggered threats of 50% tariffs and decertification affecting Canadian-made aircraft and Bombardier. Even if moderated, this highlights vulnerability of regulated sectors to politicized decisions, raising compliance, delivery, leasing and MRO disruption risk.
Industrial policy subsidies reshaping FDI
CHIPS- and clean-energy-linked incentives, paired with conditional tariff exemptions tied to U.S. production capacity, are redirecting foreign investment into U.S. fabs, batteries, and critical materials. Global firms must weigh subsidy capture against localization costs, labor constraints, and policy durability.
Gasversorgungssorgen treiben Wärmewende-Tempo
Sehr niedrige Gasspeicherstände (unter 30%) erhöhen Preis- und Versorgungsschwankungen für gasbasierte Wärme, insbesondere im Süden. Das beschleunigt Umstiegsentscheidungen zu Wärmepumpen und Fernwärme, verändert Beschaffungsstrategien und erhöht Hedging-, Vertrags- und Kreditrisiken entlang der Lieferkette.
T-MEC revisión y riesgo salida
La revisión obligatoria del T‑MEC antes del 1 de julio elevó la incertidumbre: Trump evalúa retirarse y EE.UU. exige cambios en reglas de origen, minerales críticos y antidumping. El riesgo de aranceles alteraría planes de inversión, precios y cadenas norteamericanas.
Regulatory unpredictability and enforcement
Sector-focused campaigns and uneven local enforcement create compliance uncertainty in areas such as antitrust, national security reviews, and ESG/labor enforcement. International firms should expect faster investigations, reputational exposure, and the need for stronger internal controls and local engagement.
EV and automotive supply-chain shift
Thailand’s auto sector is pivoting toward electrification: 2025 production about 1.455m units (−0.9%), while BEV output surged (reported +632% to 70,914) and sales rose (+80%). Incentives and OEM localization change parts sourcing, standards, and competitor dynamics.
Rising cyber risk and compliance
La stratégie nationale cybersécurité 2026-2030 répond à un record de 348 000 atteintes en 2025 (+75% en cinq ans). Priorités: formation, sécurisation technologique, préparation de crise, mobilisation du privé et réduction des dépendances, renforçant obligations fournisseurs et audits.
Regional Security and Trade Corridors
Turkey’s role in the Black Sea and Middle East connectivity agenda is growing, but regional conflicts keep logistics and insurance risks high. Disruptions can hit maritime routes, trucking corridors and transit times, affecting just-in-time supply chains and prompting inventory and routing diversification.
Ports, logistics upgrades and new routes
Gwadar airport, free zone incentives (23‑year tax holiday; duty exemptions) and highway links aim to expand re-export and processing capacity, while Karachi seeks terminal cost rationalisation and new Africa sea routes. Execution quality will determine lead-time and cost improvements.
Secondary sanctions via tariffs
Washington is escalating Iran pressure using tariff-based secondary measures—authorizing ~25% duties on imports from countries trading with Iran. This blurs trade and sanctions compliance, raises retaliation/WTO dispute risk, and forces multinationals to audit supply chains for Iran exposure.
Dunkirk “Battery Valley” logistics advantage
Northern France is consolidating a “Battery Valley” around Dunkirk/Bourbourg with port and multimodal links, plus grid access near Gravelines nuclear plant. This can lower inbound materials and outbound cell transport costs, influencing site selection and supply-chain routing.
Sanctions compliance and leakage risks
Investigations show tens of thousands of sanctioned-brand cars reaching Russia via China, including German models, often reclassified as ‘zero-mileage used’. This heightens legal, reputational and enforcement risk across distributors, logistics and financing; controls must tighten.
Regional HQ and market access leverage
Riyadh continues using policy to anchor multinationals locally, linking government contracting and strategic opportunities to in‑kingdom presence. Reports indicate over 200 companies have relocated HQs to Riyadh. This affects corporate structuring, tax residency, talent deployment, and bid competitiveness.
Heat-pump demand volatility
Germany’s heat‑pump market remains policy‑sensitive, with demand swinging as subsidy rules and GEG expectations change. This volatility affects foreign manufacturers’ capacity planning, distributor inventory, and installer pipelines, raising risk for long‑term investment and cross‑border component sourcing.
Data protection compliance tightening
Vietnam is increasing penalties for illegal personal-data trading under its evolving personal data protection framework, raising compliance needs for cross-border data transfers, HR systems, and customer analytics. Multinationals should expect stronger enforcement, audits, and contract updates.
Natural gas exports and regional deals
Israeli gas flows to Egypt have risen with pipelines reportedly at full capacity, supporting regional power and LNG dynamics. Export reliability and pricing depend on security and contract reforms in Egypt, influencing energy-intensive industries and investment in infrastructure.
Congress agenda and regulatory churn
Congress’ 2026 restart includes major veto votes affecting tax reform regulation and environmental licensing. A campaign-driven legislature raises probability of abrupt rule changes, delayed implementing decrees and litigation, complicating permitting timelines and compliance planning for foreign investors.
Escalating tariffs and legal risk
Wide-ranging import tariffs—especially on China—are lifting input costs and retail prices, while Supreme Court review of IEEPA authorities adds reversal risk. Companies should stress-test pricing, customs bonds, and contract clauses for sudden duty changes.
Secondary Sanctions via Tariffs
Washington is expanding coercive tools beyond classic sanctions, including threats of blanket tariffs on countries trading with Iran. For multinationals, this elevates third-country exposure, drives deeper counterparty screening, and can force rapid rerouting of trade, logistics, and energy procurement.
IMF-linked reforms and fiscal tightening
Ongoing engagement with the IMF and multilaterals supports macro stabilization but implies subsidy reforms, tax enforcement, and constrained public spending. These measures affect consumer demand, project pipelines, and pricing. Investors should track review milestones that can unlock financing and market confidence.
Logistics and multimodal corridor buildout
Budget-linked infrastructure plans emphasize freight corridors, inland waterways and port connectivity to cut transit times and logistics costs. For global manufacturers, improved hinterland access can expand viable plant locations, though land acquisition, project execution and state capacity remain key risks.
Agenda ESG e rastreabilidade
A queda de 35,4% do desmatamento na Amazônia (ago–jan) reforça fiscalização e expectativas de “desmatamento zero” até 2030, mas o Pantanal piorou (+45,5%). Para exportadores, cresce exigência de rastreabilidade, due diligence e compliance com regras de desmatamento da UE e clientes.