Data Security and Cyber Regulations

China's tightening data security laws impose compliance burdens on foreign firms, affecting cross-border data flows and operational strategies. Non-compliance risks penalties and market access restrictions.

Trade Policy and Tariff Adjustments

Recent modifications in trade policies, including tariff adjustments and negotiations with key partners like China and the EU, impact import-export dynamics. These changes influence cost structures and market access for multinational corporations.

Supply Chain Vulnerability and Diversification

Recent Chinese military exercises exposed Taiwan’s dependence on imported energy and key raw materials, highlighting vulnerabilities in global supply chains. International firms are accelerating efforts to diversify sourcing and production to mitigate risks of blockade or disruption.

CUSMA Review and Tariff Uncertainty

The upcoming 2026 review of the US-Mexico-Canada Agreement (CUSMA) and ongoing U.S. tariff threats create significant uncertainty for Canadian trade. Tariff volatility and annual reviews could reshape supply chains, investment decisions, and export strategies for Canadian businesses.

Labor Unrest and Strikes

Frequent labor strikes in key sectors such as mining and transportation create significant disruptions. These labor disputes impact production timelines and increase costs, posing risks for international investors and complicating supply chain reliability.

Supply Chain Diversification Efforts

Global companies are increasingly diversifying supply chains to Vietnam to mitigate risks from China-centric dependencies. Vietnam's competitive labor costs and improving infrastructure make it a preferred alternative, boosting its role in global manufacturing and logistics networks.

Geopolitical Shifts and Supply Chain Security

Germany’s reduced reliance on Russian energy, driven by EU sanctions, has increased vulnerability to supply disruptions and higher costs. The transition to LNG and renewables heightens infrastructure risks, impacting industrial supply chains and investment decisions.

Data Privacy, Cybersecurity, and Compliance

High-profile data breaches and regulatory scrutiny are elevating the importance of data privacy and cybersecurity consulting. International firms must adapt to stricter compliance standards, influencing risk management, supply chain integrity, and investment decisions.

National Security Strategy and Economic Unilateralism

The 2025 US National Security Strategy prioritizes reindustrialization, energy independence, and technological supremacy. Its mercantilist, interventionist stance increases regulatory barriers, marginalizes allies, and risks global market fragmentation, directly affecting international trade and investment planning.

Escalating US-Mexico Security Pressures

US threats of military intervention against Mexican drug cartels, following actions in Venezuela, have heightened bilateral tensions. Mexico’s government firmly rejects intervention, but the risk of unilateral US actions poses significant operational and reputational risks for international businesses.

Regulatory Environment and Reforms

Ongoing regulatory reforms aim to simplify business licensing and improve the investment climate. However, inconsistent enforcement and bureaucratic complexity continue to pose risks for investors, impacting operational predictability and increasing compliance costs for multinational corporations.

Currency Fluctuations and Exchange Controls

The Egyptian pound's volatility and government-imposed exchange controls affect import costs, export competitiveness, and repatriation of profits. Currency instability poses risks for supply chains reliant on imported inputs and complicates financial planning for foreign investors.

Safeguard Tariffs on Textile Imports

The government has imposed three-year safeguard tariffs on imported woven cotton fabric to protect domestic producers from import surges. This policy will impact global supply chains, requiring international businesses to reassess sourcing and market entry strategies.

AI-Led Revival in Technology Sector

India’s IT sector is poised for gradual revival in 2026, driven by enterprise AI adoption and digital transformation. While near-term growth is muted due to cost pressures and global headwinds, scaled AI deployments are expected to support long-term deal flow and sector competitiveness.

Currency Collapse and Hyperinflation

The Iranian rial has lost over 50% of its value in 2025, with inflation exceeding 42%. This volatility erodes purchasing power, destabilizes pricing, and increases operational costs for foreign businesses and investors.

Resilience Amid US Tariff Pressures

Despite 50% tariffs imposed by the US in 2024, Brazil’s exports reached a record US$348.7 billion in 2025. Diversification toward China, Argentina, and new markets offset US losses, but ongoing negotiations and potential tariff reimpositions remain a risk for exporters.

Digital Transformation Acceleration

Germany's push towards Industry 4.0 and digital infrastructure upgrades accelerates innovation but demands significant capital investment. Companies must adapt to digital workflows and cybersecurity requirements to maintain competitiveness in global markets.

Digital Transformation and Innovation Ecosystem

Turkey is advancing in digital infrastructure and innovation, fostering startups and technology adoption. This trend offers opportunities for businesses to leverage digital tools for efficiency and market expansion but also demands adaptation to evolving cybersecurity and data regulations.

Energy Transition and Security

South Korea's commitment to green energy and reducing fossil fuel dependence drives shifts in energy imports and infrastructure investments. This transition affects industrial costs and supply chains, while geopolitical risks in energy sourcing regions pose challenges to energy security and trade stability.

Structural Financial System Constraints

Pakistan’s financial system is dominated by government borrowing, crowding out private sector credit. With Rs 37 trillion in public debt exceeding banking deposits, exporters and manufacturers face high borrowing costs, stifling industrial growth and undermining export competitiveness.

US-China Strategic Rivalry Intensifies

Escalating trade tensions, technology export controls, and counter-sanctions between the US and China are reshaping global supply chains, investment flows, and regulatory environments. The Taiwan issue and legal-diplomatic confrontations further heighten risks for multinational firms operating in both markets.

Political Risks Over Government Stability

Threats of government censure over trade policy, especially Mercosur, highlight political volatility. This instability could affect regulatory predictability, investment climate, and long-term business planning for international companies in France.

Infrastructure Deficits And Service Delivery

Persistent infrastructure challenges—especially in electricity, water, and transport—hamper economic growth and business operations. Municipal debt, unreliable utilities, and deteriorating urban services increase costs and operational complexity for companies reliant on stable infrastructure.

Currency and Economic Sensitivity to China

The Australian dollar and broader economic outlook remain highly sensitive to Chinese economic performance, commodity prices, and trade policy. Fluctuations in China’s demand for Australian exports directly affect currency valuation, trade balance, and overall business confidence.

Supply Chain Disruptions from Global Events

Global disruptions such as the COVID-19 pandemic and geopolitical tensions have exposed vulnerabilities in Canada's supply chains, prompting firms to diversify sourcing and invest in domestic manufacturing capabilities to mitigate risks.

Sustainable Energy and Rural Electrification

Indonesia targets nationwide electrification by 2030, with significant progress in rural areas. The Desa Listrik program and new installations promote social equity and unlock economic opportunities, supporting investment in energy, technology, and rural development.

Regulatory Environment and Trade Policies

South Korea's evolving trade policies, including free trade agreements and export controls, shape its attractiveness for foreign investment. Regulatory changes in data privacy, environmental standards, and corporate governance affect compliance costs and market access.

Energy Transition and Biomass Expansion

Indonesia’s PLN EPI is scaling up biomass supply to reduce coal use in power plants, aiming for lower carbon emissions and sustainable energy. Strategic partnerships and regulatory compliance are central, impacting energy sector investments and ESG-focused supply chains.

US-China Trade Relations

Ongoing tensions and negotiations between the US and China continue to shape global trade policies. Tariffs, export controls, and technology restrictions impact supply chains and investment decisions, compelling businesses to reassess risk exposure and diversify sourcing strategies to mitigate geopolitical uncertainties.

Resilient US Economic Growth Amid Global Shocks

Despite trade barriers and geopolitical uncertainty, the US economy continues to show resilience, with GDP growth above 4% in late 2025. This underpins global demand, supports the dollar, and attracts foreign investment, but also raises questions about sustainability and sectoral disparities.

Domestic Market Adaptation

Russian businesses are increasingly pivoting towards import substitution and developing domestic alternatives to mitigate external pressures. This shift affects market dynamics and presents both challenges and opportunities for foreign companies.

Labor Market Restructuring and Foreign Workers

Israel has sharply reduced Palestinian labor, replacing it with foreign workers, especially in construction and agriculture. This structural shift affects wage dynamics, labor standards, and operational costs, introducing new vulnerabilities and regulatory scrutiny for businesses reliant on manual labor.

Geopolitical Tensions with China

Rising geopolitical tensions between Japan and China, particularly over territorial disputes and regional security, are influencing Japan's trade policies and foreign investment climate. These tensions may disrupt supply chains, especially in technology and manufacturing sectors, prompting businesses to reassess risk exposure and diversify sourcing strategies.

USMCA Trade Dynamics

The United States-Mexico-Canada Agreement (USMCA) continues to shape Mexico's trade landscape, influencing tariffs, labor standards, and regulatory alignment. This agreement enhances Mexico's export potential but requires compliance with stringent rules, impacting manufacturing and supply chains, especially in automotive and agriculture sectors.

Labor Market Dynamics

Indonesia's large, young workforce offers a competitive labor pool, but skill mismatches and labor regulations can constrain productivity. Labor unrest and wage inflation in certain sectors may also affect operational costs and investment attractiveness.

Fiscal Discipline and Tax Reform Challenges

Thailand’s Medium-Term Fiscal Framework targets deficit reduction and public debt control, with phased VAT increases and tax reforms. Political will is crucial; delays or reversals risk credit downgrades, higher funding costs, and reduced fiscal space for crisis response.