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Mission Grey Daily Brief - January 25, 2025

Summary of the Global Situation for Businesses and Investors

The world is facing a number of significant geopolitical and economic challenges. Donald Trump's attempt to buy Greenland has sparked debate and raised concerns about the future of the territory. Meanwhile, Trump's tariff threats against Canada and Mexico have caused fear of a potential trade war and economic damage to these countries. In West Africa, military governments in Mali, Burkina Faso, and Niger are increasing pressure on foreign firms, while Storm Eowyn has caused power cuts and transport chaos in the UK and Ireland. Lastly, the election in Belarus is likely to extend the rule of the country's long-standing dictator. These events have the potential to impact businesses and investors globally, and it is crucial to stay informed and prepared for any potential risks or opportunities that may arise.

Donald Trump's Tariff Threats

Donald Trump has threatened to impose 25% tariffs on all goods from Canada and Mexico on February 1, citing concerns over border security. This move could risk starting a full-blown trade war within the deeply interconnected North American economy, with massive implications for the entire continent. Economists predict that the tariffs would swiftly send the Canadian and Mexican economies into recession and lift consumer prices for Americans on cars, gasoline, and other imported items. However, some analysts believe that Trump is bluffing, as starting a trade war would undermine his promises to boost the US economy and tackle the cost of living. It is possible that Trump may opt not to impose the tariffs, especially if Canada and Mexico agree to renegotiate the US-Mexico-Canada Agreement (USMCA) this year.

Donald Trump's Attempt to Buy Greenland

Donald Trump is set to meet with Greenland's Prime Minister to discuss the potential purchase of the country, despite strong opposition from Denmark. Greenland is a vital strategic asset with abundant natural resources and sits in the middle of the main Arctic trade routes, an area of growing competition between international superpowers. Russia and China have increased their efforts to control the region, and there are concerns that the US has been caught off-guard. Greenland's Prime Minister has expressed willingness to speak with Trump and is working to arrange a meeting soon. However, Denmark has been firm in its stance that Greenland is not for sale and has its own ruling body.

Storm Eowyn Hits UK and Ireland

Storm Eowyn has caused power cuts and transport chaos in the UK and Ireland, with 42,000 area residents working in blue-collar jobs in the UK and 1.2 million people employed in the Irish economy. The storm has disrupted power supplies, leading to blackouts and power cuts in both countries. Transport networks have also been affected, with train and bus services disrupted and some roads closed due to flooding and fallen trees. The storm has caused significant damage to infrastructure, with some areas experiencing power outages for several days. This event highlights the vulnerability of critical infrastructure to extreme weather events and the need for businesses and governments to invest in resilience and adaptation measures.

Military Governments in West Africa

In West Africa, military governments that took power in Mali, Burkina Faso, and Niger since 2020 are increasing pressure on foreign firms, demanding higher taxes and royalties and threatening to revoke licenses and permits. This escalation of tensions has raised concerns among foreign investors and could have significant implications for businesses operating in the region. The military governments' actions are likely driven by a desire to assert control over natural resources and increase revenue for their countries. However, these actions could have unintended consequences, such as driving away foreign investment and undermining economic growth and development in the region. Businesses operating in West Africa should closely monitor the situation and consider strategies to mitigate potential risks, such as diversifying their operations and engaging in dialogue with local stakeholders.


Further Reading:

Belarus election is poised to extend the 30-year rule of 'Europe's last dictator' - Bozeman Daily Chronicle

Donald Trump's tariff threats spark fear on the frontlines of Canada's looming trade war - Financial Post

Power cuts and transport chaos as Storm Eowyn hits Ireland and UK - Citizentribune

Storm Eowyn: What we know so far - Sky News

The militaries who took power in Mali, Burkina Faso and Niger since 2020 have stepped up pressure on foreign firms - Islander News.com

Trump could do incredible damage to Mexico and Canada with a single signature - CNN

Trump is told to make Greenland a Godfather-style ‘offer they CAN’T refuse’ – but Dane says ‘f**k off’ - NewsBreak

Themes around the World:

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Currency Volatility and Capital Controls

The ruble’s real effective exchange rate surged 28% in 2025, driven by a trade surplus and high interest rates. While this curbed inflation, it hurt export competitiveness and budget revenues, complicating financial planning for foreign investors and multinational operations.

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Energy Infrastructure Expansion and Security

Egypt is expanding its power grid and accelerating the El Dabaa Nuclear Power Plant project to meet rising demand and reduce losses. Reliable energy infrastructure is essential for industrial growth, but technical and financial inefficiencies still pose operational risks.

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Supply Chain Disruptions from Conflict

Ukrainian drone and missile strikes on Russian refineries and logistics hubs in 2025 led to the lowest pipeline deliveries since 2010 and a 25% drop in energy income. Such disruptions threaten supply reliability for global partners and heighten operational risks.

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Persistent Tariff and Regulatory Uncertainty

Despite new agreements, unresolved disputes over tariffs on key goods (EVs, canola, steel, aluminum) continue to disrupt supply chains and market access. The risk of retaliatory measures and regulatory unpredictability remains a significant operational challenge for international businesses in Canada.

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Economic Reform and Investment Momentum

Recent reforms, improved energy reliability, and enhanced infrastructure have strengthened South Africa’s economic outlook. The country has exited the FATF grey list and received a credit rating upgrade, attracting renewed interest from global investors and supporting capital inflows.

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Trade Diversification Amid US Tariffs

Facing 50% US tariffs, India has accelerated trade agreements with the EU, UK, Oman, and New Zealand. This strategic pivot reduces dependence on the US, hedges against protectionism, and opens new markets for labor-intensive and technology-driven exports.

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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.

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Massive Reconstruction and Recovery Plans

Ukraine is negotiating an $800 billion recovery package with the U.S. and EU, aiming to rebuild infrastructure and attract foreign capital postwar. The scale and governance of these funds will define opportunities and risks for international contractors and investors.

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Massive Reconstruction and Investment Plans

The EU, US, and international institutions are preparing $800 billion in long-term funding for Ukraine’s recovery, focusing on infrastructure, energy, and technology. Implementation depends on security guarantees, peace progress, and overcoming institutional and corruption barriers.

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Inflationary Pressures and Currency Volatility

Food inflation and rupiah depreciation are ongoing concerns, with inflation peaking at 2.92% in 2025 and the rupiah hitting record lows. These trends impact consumer purchasing power, operational costs, and financial planning for international businesses operating in Indonesia.

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Industrial Policy and Electricity Pricing

High electricity costs have led to smelter closures and job losses in energy-intensive industries. Recent tariff relief for ferrochrome producers highlights the urgent need for a sustainable, competitive electricity pricing policy to prevent deindustrialization and protect employment.

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Canada-China Strategic Trade Pivot

Canada’s new agreement with China lowers tariffs on Chinese EVs and secures reduced Chinese tariffs on Canadian agriculture. This shift diversifies trade but risks US retaliation, reshapes supply chains, and could attract Chinese investment in Canadian manufacturing and energy sectors.

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Green Transition and Sustainable Investment Projects

Major projects like the $4.2 billion Giza waste-to-biofuel facility highlight Egypt’s commitment to green growth and the circular economy. Such initiatives create new investment opportunities, support job creation, and align with global sustainability standards, attracting ESG-focused investors.

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Shifting Trade Partnerships and Diversification

US unpredictability has prompted partners like India, the EU, and others to seek alternative trade relationships, including new deals with China. This diversification reduces US leverage, alters global trade flows, and impacts long-term market positioning for multinationals.

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Activation of EU Anti-Coercion Instrument

France is leading calls to activate the EU’s anti-coercion instrument in response to US economic pressure. This unprecedented move could trigger retaliatory trade measures, restrict US firms’ access to EU markets, and reshape the legal and operational environment for international businesses.

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Supply Chain Resilience and Nearshoring

Canadian policy emphasizes strengthening domestic supply chains, especially for critical minerals and EVs, and leveraging nearshoring opportunities. Investments in infrastructure and technology aim to reduce vulnerabilities exposed by global disruptions and geopolitical tensions.

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Green Transition and ESG Imperatives

Vietnam is investing heavily in green infrastructure, renewable energy, and sustainable finance, with Ho Chi Minh City alone planning nearly $40 billion for green transition. Compliance with global ESG standards and carbon border adjustment mechanisms is becoming critical for export competitiveness and investment attraction.

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Logistics and Infrastructure Bottlenecks

Despite increased infrastructure investment, Brazil faces persistent logistical challenges, including high costs and operational complexity. Recent downsizing by logistics firms like FedEx highlights ongoing difficulties, impacting supply chain efficiency and competitiveness for exporters and multinationals.

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Transport and Logistics Complexity Post-Brexit

UK–EU trade now depends on complex road freight and customs processes, with increased costs and delays. Businesses must invest in advanced logistics planning, compliance, and diversified routes to mitigate disruptions, making transport strategy central to maintaining international trade flows.

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Competitive Tensions and Strategic Alliances

Major French automakers, including Renault and Stellantis, are expanding their electrified portfolios but show reluctance to fully align on joint battery ventures. This rivalry shapes the pace of innovation, localization of supply chains, and the scope for international partnerships.

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Transport and Logistics Infrastructure Expansion

Large-scale upgrades, such as Ankara Esenboğa Airport’s expansion and new railway corridors, are set to boost Turkey’s role as a regional logistics hub. Improved connectivity will facilitate trade flows, reduce transit times, and enhance Turkey’s attractiveness for multinational supply chains.

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Infrastructure Modernization and Trade Connectivity

Major infrastructure projects, such as the new semi-automated container terminal at Sokhna Port, are enhancing Egypt’s trade connectivity and logistics capacity. These initiatives are vital for supporting export growth and integrating Egypt into global supply chains.

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EU Accession Negotiations Accelerate Reforms

Ukraine’s EU accession talks are driving economic and regulatory reforms, aiming to align with European standards. While this process opens long-term market access, it also imposes transitional compliance burdens and sectoral adjustments for international investors and exporters.

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US-Australia Alliance Deepens Amid Indo-Pacific Shifts

AUKUS and the Pax Silica coalition strengthen Australia's role in critical technology and defense supply chains. As US policy demands greater allied burden-sharing, Australia faces pressure to increase defense spending and self-reliance, influencing investment in advanced manufacturing and security-sensitive sectors.

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Fiscal Expansion and Market Volatility

Japan’s aggressive fiscal stimulus and proposed suspension of the 8% food consumption tax have triggered bond market volatility and yen fluctuations. With debt-to-GDP exceeding 230%, concerns over fiscal sustainability and potential debt-servicing risks are affecting global investor sentiment and cross-border capital flows.

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Logistics and Port Infrastructure Crisis

Persistent inefficiencies at major ports, especially Cape Town and Durban, continue to undermine export competitiveness, disrupt supply chains, and cost the economy hundreds of millions of rands annually, despite recent incremental improvements and reform efforts.

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Widespread Protests and Political Instability

Mass protests driven by economic hardship and political repression have spread nationwide, resulting in hundreds of deaths. The risk of regime change or violent crackdowns creates extreme uncertainty for investors, supply chains, and operational continuity.

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Energy Security and Nuclear Restarts

Japan’s restart of the Kashiwazaki-Kariwa nuclear plant, the world’s largest, marks a pivotal shift in energy policy. This move enhances energy security, reduces fossil fuel reliance, and supports emissions targets, but faces local opposition and regional security risks, especially amid tensions with China and North Korea.

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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.

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EU Energy Ban Accelerates Market Shift

The EU will fully ban Russian LNG and pipeline gas imports by 2027, with oil phase-out planned. This accelerates Europe’s diversification, reshapes supply chains, and compels Russia to seek alternative buyers, affecting global energy pricing and business operations across sectors.

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US AGOA Renewal and Trade Certainty

The US House approved a three-year AGOA extension, providing duty-free access for South African exports. This renewal is critical for manufacturing and agriculture, sustaining hundreds of thousands of jobs and ensuring predictability for trade and investment strategies.

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Hamas Disarmament and Security Dilemmas

The demilitarization of Hamas remains a central, unresolved issue. US and Israeli insistence on full disarmament is met with resistance, and the lack of clear enforcement mechanisms heightens the risk of renewed conflict, affecting supply chains, insurance costs, and investment planning.

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Strategic Supply Chain Diversification

Vietnam is consolidating its role as a global supply chain hub, benefiting from shifts away from China. The government is actively promoting resilience, infrastructure upgrades, and trade diversification to mitigate external shocks, making Vietnam increasingly attractive for international manufacturers and investors.

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Macroeconomic Stabilization and Reform Momentum

Pakistan has achieved notable macroeconomic stabilization, with inflation dropping to 4.5–5.5%, policy rates declining to 10.5%, and foreign reserves rising to $16.1 billion. Structural reforms, fiscal discipline, and privatization are improving investor sentiment and positioning Pakistan as a more attractive investment destination.

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Sanctions and Export Controls Expand

The US has broadened its use of sanctions and export controls, targeting countries like China, Russia, and Venezuela. These measures affect technology transfers, energy trade, and financial transactions, requiring businesses to enhance compliance and monitor regulatory developments closely.

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Geopolitical Fragmentation and Business Uncertainty

US interventions abroad and retreat from multilateralism have contributed to a fragmented geoeconomic landscape. National security concerns, sanctions, and unpredictable policy shifts increase operational risks for international businesses, requiring adaptive strategies and robust risk management frameworks.