Mission Grey Daily Brief - January 29, 2025
Summary of the Global Situation for Businesses and Investors
The world is currently facing a multitude of geopolitical and economic challenges. President Trump's aggressive foreign policy and trade war threats have raised tensions with allies and adversaries alike. The Russia-Ukraine war continues to devastate Ukrainian families and North Korea's involvement has led to heavy losses and partial withdrawal of their troops. Congo's conflict with Rwanda-backed rebels has escalated, displacing millions and causing a humanitarian crisis. Diplomatic tensions are rising between the US and Latin American countries over deportation policies and tariff disputes.
US-EU Trade War over Greenland
The US-EU relationship is under strain due to President Trump's threats to seize Greenland. This self-governing Danish territory is strategically important for geopolitical and security reasons, and its abundance of natural resources makes it a critical asset for modern weaponry and dominance in key economic sectors. Trump's aggressive stance has raised the possibility of a trade war between the US and EU, with severe tariffs on Danish exports to the US being threatened. This could significantly impact businesses in both regions, particularly those relying on Danish exports.
Russia-Ukraine War and North Korea's Involvement
The Russia-Ukraine war continues to inflict heavy losses on both sides, with civilians bearing the brunt of the conflict. North Korea's involvement has led to heavy casualties and partial withdrawal of their troops. Kim Jong Un's regime faces growing discontent from younger generations and challenges in maintaining loyalty. The potential for a peace settlement remains uncertain, with President Trump expressing a desire to meet with Vladimir Putin and Zelenskiy emphasizing the need for US leadership in any peace force.
Congo's Conflict with Rwanda-Backed Rebels
Congo's conflict with Rwanda-backed rebels has escalated, with rebels advancing into a key eastern city and causing a major humanitarian crisis. The M23 rebels, one of about 100 armed groups, have captured several towns and advanced into Goma, a regional trade and humanitarian hub. The humanitarian situation is extremely worrying, with hundreds of thousands attempting to flee the violence. Aid groups are struggling to reach displaced people, and the conflict has resulted in one of the world's largest humanitarian crises.
US-Latin America Diplomatic Tensions
Diplomatic tensions are rising between the US and Latin American countries over deportation policies and tariff disputes. Colombia and Mexico have objected to the use of military aircraft for deportations, and Brazil has expressed concern over the treatment of undocumented immigrants. President Trump's aggressive stance has led to retaliatory measures and threats of tariff wars, increasing tensions in the region. Businesses operating in Latin America should monitor the situation closely and prepare for potential disruptions in trade and diplomatic relations.
Further Reading:
A Bulgarian shipping company denies its vessel sabotaged a Baltic Sea cable - The Independent
Colombia quickly found out Trump has no intention of backing down - Sky News
In a split second, Russia wipes out three generations of a Ukrainian family - BBC.com
Kim Jong Un’s grip on power wavers as North Korea’s youth defy loyalty - The New Voice of Ukraine
Russia wipes out three generations of a family in one strike - BBC.com
Trade war could erupt between US and EU over Trump’s threat to seize Greenland - WSWS
Trump ‘Serious as a Heart Attack’ About Launching Trade War With Canada and Mexico - The Daily Beast
Themes around the World:
Macroeconomic recovery and rate cuts
Inflation has eased to around 1.8% with a stronger shekel, reopening scope for Bank of Israel rate cuts. Cheaper financing may support investment, yet currency strength can squeeze exporters and pricing, influencing hedging strategies and contract denomination choices.
Tech export controls tightening
Stricter semiconductor and AI export controls and aggressive enforcement are reshaping tech supply chains. Recent fines for unlicensed China shipments and stringent licensing terms for AI GPUs raise compliance costs, constrain China revenues, and accelerate ‘compute-at-home’ and redesign strategies.
Industrial policy reshapes investment
CHIPS/IRA-style incentives and local-content rules steer capex toward U.S. manufacturing, batteries, and clean tech, while raising compliance complexity for multinationals. Subsidies can improve U.S. project economics, but may trigger trade frictions, retaliation, and fragmented global production strategies.
Monetary easing amid sticky services
UK inflation fell to 3.0% in January while services inflation stayed elevated near 4.4%, keeping the Bank of England divided on timing of rate cuts. Shifting borrowing costs will affect sterling, financing, consumer demand, and capex planning.
Economic security investment state backstop
Tokyo plans a “designated overseas business projects” regime where government absorbs losses on strategic overseas investments (ports, undersea cables, data centers), supported by JBIC financing. This can crowd-in private capital, shift bid competitiveness, and steer FDI toward ASEAN corridors.
Incertidumbre por revisión del T-MEC
La revisión obligatoria del T‑MEC hacia el 1 de julio y señales de posible salida o “modo zombi” elevan el riesgo regulatorio. Se discuten reglas de origen, antidumping y minerales críticos, afectando decisiones de inversión, pricing y contratos de largo plazo.
Water scarcity and urban infrastructure failures
Gauteng’s water constraints—Johannesburg outages lasting days to nearly 20—reflect aging networks, weak planning and bulk-supply limits. Operational continuity risks include downtime, hygiene and labour disruptions, higher onsite storage/treatment costs, and heightened local social tensions.
Financial system tightening and liquidity
Banking reforms—phasing out credit quotas and moving toward Basel III—may reprice credit and widen gaps between strong and weak lenders. With credit-to-GDP above 140% and periodic liquidity spikes, corporates may face higher working-capital costs and tougher project financing.
Border, visa and immigration digitisation
Home Affairs is expanding Electronic Travel Authorisation and pursuing a digital immigration overhaul using biometrics and AI to cut fraud and delays. If implemented well, it eases executive mobility and tourism; if not, it can create compliance bottlenecks and privacy litigation risk.
Labor shortages and mobility constraints
Reserve duty, reduced availability of non-Israeli workers, and security-related absenteeism strain construction, services, and some industrial operations. Companies should expect wage pressure, longer project timelines, and greater need for automation, subcontracting, and cross-training to maintain continuity.
Sanctions compliance and rerouting risks
Ongoing Russia-related sanctions and rising evidence of gray-market rerouting via third countries increase exposure for Japanese brands and distributors. Companies should tighten end-use checks, dealer controls, and trade-finance screening to avoid enforcement, reputational harm, and shipment seizures.
Energy export squeeze and rerouting
Proposed EU maritime-services bans for Russian crude and tighter LNG tanker/icebreaker maintenance restrictions aim to cut export capacity and revenues (oil and gas revenues reportedly down about 24% in 2025). Buyers rely more on discounted, high-friction routes via India, China, and Türkiye.
UK–EU border frictions endure
Post‑Brexit customs and SPS requirements, the Border Target Operating Model, and Northern Ireland arrangements continue to reshape UK–EU flows. Firms face documentation risk, delays, and higher logistics overheads, driving route diversification, inventory buffers, and reconfiguration of distribution hubs serving EU markets.
EU–Thailand FTA acceleration
Bangkok and Brussels aim to conclude an EU–Thailand FTA by mid-2026, promising tariff reduction and investment momentum, especially in S-curve industries. However, compliance demands on environment, product standards and regulatory alignment will raise costs for lagging manufacturers and SMEs.
Energy import dependence and LNG
Taiwan’s tight energy margins and heavy LNG reliance create acute vulnerability to maritime disruption. Under the U.S. deal, Taiwan plans US$44.4B LNG/crude purchases through 2029, underscoring strategic stockpiling, grid upgrades, and potential cost volatility for industry.
توسع الموانئ والممرات اللوجستية
خطة لوجستية وطنية تربط موانئ المتوسط والبحر الأحمر بموانئ جافة ومناطق صناعية عبر سبعة ممرات متعددة الوسائط، مع توسعات أرصفة عميقة بنحو 70 كم. التشغيل التجريبي لمحطة «تحيا مصر 1» بدمياط بطاقة 3.5 مليون TEU يعزز قدرات المناولة وجذب الخطوط.
Tariff Volatility and Litigation Risk
On‑again, off‑again tariff actions and court challenges are driving demand swings and front‑loading. Forecasts show US container imports down 2% YoY in H1 2026, with March -12% and April -7.1%, complicating pricing, contracts, and inventory planning.
Escalada de sanciones y cumplimiento
La estrategia de “máxima presión” se está endureciendo: más buques y redes logísticas vinculadas a Irán entran en listas de sanciones y crece la amenaza de sanciones secundarias (p.ej., aranceles hasta 25% a socios). Eleva riesgos legales, de pagos y reputación.
Trade compliance and reputational exposure
Scrutiny of settlement-linked trade and corporate due diligence is intensifying, including EU labeling and potential restrictions. Companies face heightened sanctions, customs, and reputational risks across logistics, retail, and manufacturing, requiring enhanced screening, traceability, and legal review.
Escalating secondary sanctions pressure
The US is tightening “maximum pressure” through new designations on Iran’s oil/petrochemical networks and vessels, plus threats of blanket tariffs on countries trading with Tehran. This raises compliance, banking, and counterparty risks for global firms and intermediaries.
Forced-labor import enforcement intensifies
CBP enforcement under the Uyghur Forced Labor Prevention Act continues to drive detentions and documentation demands, increasingly affecting complex goods. Companies need deeper tier-n traceability, auditable supplier evidence, and contingency inventory planning to avoid port holds and write-offs.
Nearshoring con cuellos de energía
El nearshoring sigue fuerte por proximidad a EE.UU., pero la expansión industrial choca con límites de red eléctrica, permisos y capacidad de generación. La incertidumbre regulatoria y costos de conexión retrasan proyectos, elevan CAPEX y favorecen ubicaciones con infraestructura disponible.
Critical minerals leverage and reshoring
U.S. policy increasingly links trade and security to critical minerals and domestic capacity. Officials explicitly frame rare earths and magnets as weaponized supply points, reinforcing incentives for reshoring and allied sourcing, and pressuring firms to redesign inputs and secure non-China supply alternatives.
Macrostability via aid and reserves
Despite war shocks, NBU policy easing to 15% and a reserves build to a record ~$57.7bn (Feb 1, 2026) reflect heavy external financing flows. This supports import capacity and FX stability, but leaves businesses exposed to conditionality, rollover timing, and renewed energy-driven inflation.
Energy import diversification to US
Pertamina menandatangani MoU pasokan light crude dan kontrak LPG 2026 dengan Hartree dan Phillips 66, total LPG sekitar 2,2 juta metrik ton. Bersama komitmen ART membeli energi AS, ini menggeser pola impor dari pemasok tradisional, berdampak pada harga, logistik, dan peluang trading/penyimpanan regional.
Ports and logistics hub acceleration
Saudi ports are expanding capacity and private participation to capture transshipment and east–west trade. January throughput reached 738,111 TEUs (+2% YoY) with transshipment +22%. Deals include APM Terminals buying 37.5% of Jeddah’s 4.1m TEU South Container Terminal, plus new logistics centers.
US tariffs hit German exports
New US tariff measures are reducing German competitiveness: exports to the US fell 9.3% in 2025 to ~€147bn and the bilateral surplus narrowed to €52.2bn. Firms should reassess pricing, localization and route-to-market for North America.
Energy roadmap: nuclear-led electrification
The PPE3 to 2035 prioritizes six new EPR2 reactors (first expected 2038) and aims to raise decarbonised energy to 60% of consumption by 2030 while trimming some solar/wind targets. Impacts power prices, grid investment, and energy‑intensive manufacturing location decisions.
Property slump and financial spillovers
China’s housing correction continues to depress demand and strain credit. January new-home prices fell 3.1% y/y and 0.4% m/m, with declines in 62 of 70 cities. Persistent developer debt and bank exposures weigh on consumption, payments risk, and counterparty reliability across B2B sectors.
Logistics disruption and labor risk
Rail and potential port labor disruptions remain a recurrent risk, with spillovers into U.S.-bound flows. For exporters of bulk commodities and importers of containerized goods, stoppages elevate inventory buffers, demurrage, and rerouting costs, stressing time-sensitive supply chains.
Gigafactory build-out accelerates
ProLogium’s Dunkirk solid-state gigafactory broke ground in February 2026, targeting 0.8 GWh in 2028, 4 GWh by 2030 and 12 GWh by 2032, with land reserved to scale to 48 GWh—reshaping European sourcing and localisation decisions.
Data (Use and Access) Act
Core provisions of the UK Data (Use and Access) Act entered into force, expanding ICO powers to compel interviews and technical reports and enabling fines up to £17.5m or 4% of global turnover under PECR. Compliance programs, AI/data governance, and cross-border data strategies may need recalibration.
Geopolitical alignment and sanctions exposure
Heightened US–South Africa tensions increase tail-risk of targeted financial measures. With roughly 20% of SA government debt held by foreigners, any restrictions could spike yields and weaken the rand, complicating trade finance, USD liquidity, and investment returns.
EU-China EV trade rebalancing
EU’s new ‘price undertaking’ mechanism is reshaping China-made EV flows: VW’s Cupra Tavascan won a tariff waiver by accepting minimum pricing, quotas and EU battery-investment commitments. This creates a template for others, altering sourcing, margins and trade friction.
Health-tech export platform for simulation
Finland’s health-technology exports exceed €2.5bn with a stated ambition toward €3bn this decade, underpinned by strong digital health infrastructure. This creates a pull for VR training and clinical simulation solutions, but requires rigorous clinical validation and procurement navigation.
Bahnnetz-Sanierung stört Logistik
Großbaustellen bei der Bahn (u.a. Köln–Hagen monatelang gesperrt) verlängern Laufzeiten im Personen- und Güterverkehr und erhöhen Ausweichkosten. Für internationale Lieferketten steigen Pufferbedarf, Lagerhaltung und multimodale Planung; zugleich bleibt die Finanzierung langfristiger Netzmodernisierung unsicher.