Mission Grey Daily Brief - January 31, 2025
Summary of the Global Situation for Businesses and Investors
The global situation is currently marked by President Trump's controversial policies, which have impacted various countries and regions. In Myanmar, the UN Chief has urged a return to civilian rule as the country faces a worsening crisis, with millions in need of humanitarian aid and rising food insecurity. Afghanistan is also facing challenges due to President Trump's suspension of foreign aid, leading to anxiety over food supplies and disruptions for charities. Greece's popular tourist island of Santorini is experiencing increased volcanic activity, which could impact tourism and local communities. Additionally, Denmark and the EU are rallying against Trump's ambitions for Greenland, emphasising territorial integrity and sovereignty.
Trump's Tariff Showdown with Colombia
President Trump's tariff showdown with Colombia has sent ripples through Latin America, signalling turbulent times ahead. The dispute, sparked by Colombian President Gustavo Petro's refusal to accept deportees, led to Trump imposing a 25% tariff on Colombian exports, with threats of escalation. This standoff sends a clear message to Latin America that resistance to U.S. immigration policies will be met with swift economic consequences. Left-leaning governments, especially those misaligned with Washington's priorities, should expect heightened scrutiny and pressure. Smaller economies reliant on U.S. trade may face significant risks, as Trump's willingness to weaponize immigration and tariffs could disrupt regional economic balance and erode trust in U.S.-Latin American relations.
China and Russia may benefit from this situation, as some countries may strengthen ties with these U.S. competitors to counterbalance U.S. influence. Colombia's concession avoided a trade war, but other Latin American countries may be tempted to defy Trump, potentially compromising their sovereignty and economic stability.
Trump's Impact on Canada and the U.S.-Canada Relationship
President Trump's policies are also driving a wedge between Canada and the United States, with discussions about Canada potentially joining the EU. Canada is seeking ways to mitigate the impact of U.S. tariffs, with Trump's nominee for commerce secretary suggesting swift border action. This strained relationship could have significant implications for trade and security cooperation between the two countries.
Humanitarian Crisis in Myanmar
The UN Chief has called for a return to civilian rule in Myanmar as the country faces a worsening humanitarian and human rights crisis, with nearly 20 million people expected to need aid. Hunger has reached alarming levels, with 15 million people projected to face acute food insecurity due to soaring inflation and supply chain disruptions. Conflict and displacement have further exacerbated the situation, with millions fleeing across borders and communities on the brink of collapse.
The UN has expressed concerns over the military's plan to hold elections, warning that intensifying conflict and human rights violations do not permit free and peaceful polls. The UN has called for stronger sanctions, restrictions on the junta's access to weapons, and support for international justice mechanisms to address the root causes of the crisis.
Trump's Ambitions for Greenland and EU Response
President Trump's ambitions for Greenland have ignited tensions between the U.S. and European nations, particularly Denmark, over the strategically important territory. Trump's threats of military action have prompted a united response from Denmark and the EU, highlighting the geopolitical significance of Greenland. Danish Prime Minister Mette Frederiksen has reiterated Denmark's firm stance, stating that "Greenland is Greenland and the Greenlandic people are people."
The EU has expressed solidarity with Denmark, signalling potential collective military readiness and a lack of tolerance for unilateral U.S. actions. Denmark has announced plans to increase its military capabilities and strengthen its position within the North Atlantic, bolstering surveillance and sovereignty over the Arctic region. This crisis also underscores the EU's commitment to safeguarding its member states and territorial integrity.
Recommendations for Businesses and Investors
Given the evolving global situation, businesses and investors should closely monitor developments and assess the potential impact on their operations in the affected regions. For those with interests in Latin America, closely monitoring the evolving relationship between the U.S. and Colombia and its potential impact on trade and investment is crucial. Engaging in scenario planning and developing contingency strategies can help businesses mitigate risks and adapt to changing circumstances.
In the context of Trump's policies, businesses should consider the potential implications for their supply chains, market access, and overall business environment. Diversifying markets and supply chains may be prudent to reduce exposure to potential disruptions.
As the situation in Myanmar continues to deteriorate, businesses with operations or supply chains in the region should prioritise the safety of their employees and consider contingency plans to ensure business continuity.<co: 0,1,3,4,5,6,7,9,10,11,13,14>ensure business continuity.</
Further Reading:
'Uncertainty never ends' as deal to free Cuba prisoners unravels under Trump - Citizentribune
Myanmar: UN chief urges return to civilian rule as crisis worsens - UN News
New FM Laura Sarabia must reset Colombia’s image with Washington - The City Paper Bogotá
Secretary of State says Trump's plans for Greenland 'not a joke' - The Center Square
Trump's Greenland Ambitions Stir Unprecedented EU Defenses - Evrim Ağacı
Trump’s Nine-Hour Economic War on Colombia Rattles Markets - Yahoo Finance
Trump’s tariffs loom and even his supporters in Texas are nervous - The Texas Tribune
Themes around the World:
Long-term LNG contracting shift
Japan is locking in multi-decade LNG supply to secure power for data centres and industry. QatarEnergy’s 27-year deal with Jera covers ~3 Mtpa from 2028, improving resilience but adding destination-clause rigidity and exposure to gas-demand uncertainty from nuclear restarts.
High-risk Black Sea shipping
Merchant shipping faces drone attacks, sea mines, GNSS jamming/spoofing, and sudden port stoppages under ISPS Level 3. Operational disruption and claims exposure rise for hull, cargo, delay, and crew welfare, complicating charterparty clauses, safe-port warranties, and routing decisions.
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.
EIB Lending Returns, Project Pipeline
The gradual resumption of European Investment Bank operations—reported with €200m earmarked for renewable energy—signals improving European financing access. This can catalyze infrastructure, green industrial upgrades and supplier capacity expansion, while raising compliance expectations on procurement, ESG and governance standards.
Stricter data-breach liability regime
Proposed amendments to the Personal Information Protection Act would shift burden of proof toward companies, expand statutory damages, and add penalties for leaked-data distribution. Compliance, incident response, and cyber insurance costs likely rise, especially for high-volume consumer platforms and telecoms.
Industrial policy reshapes investment
Federal incentives and procurement preferences for semiconductors, EVs, batteries, and critical minerals are accelerating domestic buildouts while tightening local-content expectations. Multinationals may gain subsidies but must manage higher US operating costs, labor constraints, and complex reporting requirements tied to funding.
District heating investment surge
City utilities are accelerating Wärmenetze expansion and modernization, including low‑temperature networks and large heat pumps. This drives major capex opportunities for foreign EPCs, pipe and insulation suppliers, and control-system vendors, but also heightens exposure to permitting delays and municipal procurement rules.
Semiconductor subsidies and scaling
Tokyo’s push to rebuild advanced chip capacity via subsidies and anchor projects (TSMC Japan expansion, Rapidus 2nm ambitions) is reshaping supplier location decisions across materials, tools and chemicals. Expect local-content incentives, talent constraints and tighter export-control alignment with partners.
Tourism demand mix and margin squeeze
Hotels forecast ~33m foreign arrivals in 2026 versus a 36.7m target; China demand is expected to soften while long-haul grows. Limited room-rate increases and higher labor/social-security costs pressure margins, impacting hospitality, aviation, retail, and real estate revenues.
Rising antitrust pressure on tech
U.S. antitrust enforcement is intensifying across major digital and platform markets, affecting dealmaking and operating models. DOJ is appealing remedies in the Google search monopoly case; FTC expanded an enterprise software/cloud probe into Microsoft bundling and interoperability; DOJ also widened scrutiny around Netflix conduct.
Crackdown on grey capital
Industry leaders are urging tougher action against scams, money laundering and “grey capital,” warning reputational and compliance risks if Thailand is seen as a laundering hub. Expect tighter KYC/AML enforcement, more scrutiny of cross-border payments, and operational impacts for fintech and trade.
External financing rollover dependence
Short-term bilateral rollovers (e.g., UAE’s $2bn deposit extended at 6.5% to April 2026) underscore fragile external buffers. Debt-service needs and refinancing risk can trigger FX volatility, capital controls, delayed profit repatriation, and higher country risk premia.
Black Sea corridor export fragility
Ukraine’s maritime corridor still carries over 90% of agricultural exports, yet repeated strikes on ports and approaches cut monthly shipments by 20–30%, leaving about 10 million tonnes of grain surplus in 2025. Unreliable sailings increase freight, insurance, and contract-performance risk.
Import quotas for fuels tighten
Indonesia’s import caps are affecting private retailers, with Shell reporting work with government on 2026 fuel import quotas amid station shortages. Coupled with policy to stop diesel import permits for private stations, firms face supply disruptions, higher working capital needs, and reliance on Pertamina.
Frozen assets, litigation, retaliation risk
Debate over using immobilized Russian sovereign assets to back Ukraine financing is intensifying, alongside Russia’s lawsuits against Euroclear seeking about $232bn. Businesses face heightened expropriation/retaliation risk, asset freezes, and legal uncertainty for custodial holdings, claims, and arbitration enforceability.
Carbon border and ETS policy shifts
Changes to UK carbon pricing and the forthcoming Carbon Border Adjustment Mechanism raise exposure for heavy industry, particularly steel, with some estimates of carbon costs rising toward £250m by 2031 and higher later. Import competitiveness, pricing, and procurement strategies will shift.
Local content procurement intensifies
Local-content policies are deepening: PIF-linked spending reached SAR591bn ($157bn) in 2020–24, and government procurement increasingly scores local value-add. Foreign firms face higher compliance costs, partner-selection risk, and incentives to localize manufacturing, services, and workforce.
Port congestion and export delays
Transnet’s operational fragility—illustrated by Cape Town container backlogs leaving roughly R1bn of fruit exports delayed—raises costs, spoilage risk and schedule uncertainty. Low global port performance rankings and equipment breakdowns drive rerouting, higher inland transport spend, and volatile lead times.
China trade ties and coercion
China remains Australia’s dominant trading partner, but flashpoints—such as Beijing’s warnings over the Chinese-held Darwin Port lease and prior export controls on inputs like gallium—keep coercion risk elevated, complicating contract certainty, market access, and contingency planning for exporters and import-dependent firms.
Orta Koridor lojistik fırsatı
Trans-Hazar Orta Koridoru, Çin‑Avrupa transit süresini deniz yolundaki 35–50 günden 18–25 güne düşürebiliyor. Türkiye’nin demiryolu/liman bağlantıları, depolama ve gümrük verimliliği yatırımları önem kazanıyor; kapasite darboğazı ve sınır geçiş gecikmeleri operasyonel risk.
Shadow fleet interdiction and shipping risk
Western enforcement is shifting from monitoring to interdiction: boardings, seizures, and “stateless vessel” designations target Russia-linked tankers using false flags and AIS gaps. This increases marine insurance premiums, port due‑diligence burdens, and disruption risk for Black Sea, Baltic, and Mediterranean routes.
CRE losses constrain regional lenders
Commercial real estate stress—especially office and maturing balloon loans—continues to pressure regional-bank capital and credit quality. As banks retrench, availability and pricing of construction, warehouse, and SME credit worsen, affecting US expansion plans and domestic supply-chain investment.
Tightening China tech export controls
Export-control enforcement is intensifying, highlighted by a $252 million U.S. settlement over unlicensed shipments to SMIC after Entity List designation. Expect tighter licensing, more routing scrutiny via third countries, higher compliance costs, and greater China supply-chain fragmentation.
Shareholder activism and governance shifts
Japan’s record M&A cycle and activist pressure are reshaping capital allocation and control structures. Elliott opposed Toyota Industries’ take-private price, while Fuji Media launched a ¥235bn buyback to exit an activist stake. Deal risk, valuation scrutiny, and governance expectations are rising for investors.
Indigenous Partnerships in Resource Projects
New agreements ensure Indigenous participation and ownership in critical minerals and infrastructure projects, especially in Western and Northern Canada. This approach enhances project legitimacy, streamlines permitting, and aligns with ESG expectations for international investors.
PPE 2035: nucléaire relancé
La France adopte la PPE3 par décret: six EPR2 confirmés (première mise en service vers 2038) et option de huit supplémentaires, avec objectifs ENR revus à la baisse. Impacts: coûts électriques, contrats long terme, besoins réseau et localisation industrielle.
Monetary tightening and demand pressures
The RBA lifted the cash rate 25bp to 3.85% as inflation re-accelerated (headline ~3.8% y/y; core ~3.3–3.4%) and labour markets stayed tight (~4.1% unemployment). Higher funding costs and a stronger AUD affect capex timing, valuations, and import/export competitiveness.
EU partnership deepens market access
Vietnam–EU ties were upgraded to a comprehensive strategic partnership, reinforcing the EVFTA-driven trade surge (two-way trade about US$73.8bn in 2025) and opening new cooperation on infrastructure, cybersecurity, and supply-chain security—supporting diversification away from US/China shocks.
Regulatory tightening in housing finance
Bank of Israel measures cap mortgage maturities at 30 years, tighten repayment ratios, and raise bank capital requirements. This can cool real-estate demand, affect construction supply chains, and influence commercial leasing dynamics as households and developers adjust financing structures and cash flows.
LNG export surge and permitting
DOE/FERC are accelerating LNG export permitting and returning applications to “regular order,” driving new capacity filings (e.g., Corpus Christi expansion) and long-term 15–20 year contracts. Benefits include energy supply diversification; risks include oversupply and price volatility by 2030.
Escalating Sanctions Disrupt Trade Flows
Intensified US and EU sanctions, including on shipping, oil, and digital assets, severely restrict Iran’s access to global markets. These measures complicate cross-border transactions, increase compliance risks, and force businesses to navigate opaque networks, raising operational and reputational risks.
Disinflation and rate-cut cycle
Inflation has eased into the 1–3% target, with recent readings near 1.8% and markets pricing further Bank of Israel rate cuts. Lower borrowing costs may support demand, but a stronger shekel can squeeze exporters and reshuffle competitiveness across tradable sectors.
EV supply-chain localization rules
Proposed “100% US-made” requirements for federally funded EV chargers would effectively stall parts of the build-out, given reliance on imported power modules and electronics. This raises uncertainty for EV infrastructure investors, equipment suppliers, and downstream fleet electrification plans.
Санкции и вторичные риски
20-й пакет ЕС расширяет санкции: полный запрет морских услуг для российской нефти, +43 судна «теневого флота» (640), ограничения на банки и криптоплатформы, новые импорт/экспорт‑запреты. Растут риски вторичных санкций и комплаенса для глобальных цепочек поставок.
High energy costs, gas risk
Germany faces structurally higher industrial power costs and renewed gas-storage risk. Storage levels were ~26–34% in early February and summer prices near winter 2026/27 reduce refill incentives; some sites may close. Energy-intensive production and contracts face volatility.
Strategic stockpiles and resilience push
Japan’s government and industry continue building resilience via stockpiling, diversification, and domestic capability in materials and energy, accelerated by global geo-economic fragmentation. Businesses should anticipate subsidies tied to reshoring, stricter supply-chain transparency, and contingency planning expectations.