Labor Market Reforms and Transparency

France is implementing EU directives on salary transparency to address gender pay gaps and workforce equity. New laws require disclosure of pay ranges and justification of disparities, impacting HR policies, compliance costs, and labor relations for domestic and international employers.

Energy reform and grid constraints

CFE’s new “mixed project” rules allow private partnerships but require CFE majority (≥54%) in joint investments, shaping contract design and bankability. Meanwhile grid modernization, storage and microgrids accelerate as industrial demand rises, making power availability a gating factor for plants.

Regulatory Uncertainty and Standards Divergence

Diverging regulatory regimes between the UK, EU, US, and China complicate compliance for international businesses. Ongoing disputes over digital services, food standards, and AI governance increase operational complexity and may fragment market access for UK-based firms.

Robust Foreign Investment Inflows

Brazil attracted record foreign direct investment in 2025, totaling €71.9 billion (3.41% of GDP), driven by strong stock market performance and diversified investor interest. Sustained inflows reinforce Brazil’s position as a key emerging market destination for global capital.

Domestic Reforms and Infrastructure Investment

Canada is fast-tracking $1 trillion in investments across energy, AI, critical minerals, and trade corridors, alongside tax reforms and interprovincial trade liberalization. These initiatives aim to boost competitiveness and supply chain resilience, presenting significant opportunities for global investors.

National Privatization Strategy Expands PPPs

The new National Privatization Strategy aims to sign over 220 public-private partnership contracts and mobilize $64 billion in private investment by 2030. This initiative opens infrastructure, health, education, and logistics to foreign investors, enhancing competitiveness and operational efficiency.

Semiconductor controls and AI choke points

Tighter export controls, selective approvals, and new tariffs on advanced chips are reshaping global tech supply chains. Firms face compliance burdens, China retaliation risk, and higher hardware costs; U.S.-based capacity and trusted suppliers gain strategic priority.

Critical Minerals and Rare Earths Geopolitics

Brazil’s vast reserves of lithium and rare earths are now central to EU and US supply chain strategies, as both seek to reduce dependence on China. New agreements position Brazil as a key supplier for the global energy transition, but value addition and local benefit remain challenges.

Logistics Modernization and 3PL Expansion

Mexico’s third-party logistics (3PL) market is forecast to nearly double to $26.8 billion by 2033, driven by nearshoring, e-commerce, and infrastructure investment. Enhanced customs coordination, digitalization, and cross-border logistics partnerships are improving supply chain efficiency and supporting regional integration.

Energy Transition and Green Ammonia Expansion

Japan is leading Asia in green ammonia co-firing projects and renewable energy investments, targeting decarbonization of power generation. Major projects and international supply agreements position Japan as a regional leader in clean energy, with significant implications for energy-intensive industries and supply chains.

Post-Brexit UK-EU Trade Realignment

The UK government seeks closer economic ties with the EU without rejoining the customs union, balancing regulatory alignment and trade benefits. Ongoing negotiations and political volatility create uncertainty for businesses, particularly regarding customs, standards, and future market access.

Modernization of Trade and Tariff Policy

Recent reforms target the National Tariff Commission and broader trade policy, aiming to enhance trade-remedy tools, liberalize tariffs, and improve export competitiveness. These changes are designed to align with global trade norms and support private sector growth, but implementation remains key.

US Trade Policy Realignment Accelerates

Recent US trade policy shifts, including new tariffs and renegotiated agreements, are reshaping global commerce. These changes drive uncertainty in cross-border operations, impacting supply chain strategies and international investment decisions for multinational firms.

China-Finland Economic and Tech Cooperation

Finland and China are deepening cooperation in energy transition, technology, and circular economy. Bilateral agreements and Chinese investments in Finnish infrastructure offer growth opportunities but also require careful navigation of regulatory, political, and security considerations.

De-dollarisation and local-currency settlement

Russian officials report near‑100% national‑currency use in trade with China and India and ~90% within the EAEU, reducing USD/EUR reliance. For foreign firms, FX convertibility, hedging, and repatriation complexity rise, especially where correspondent banking access is constrained.

Strategic Contest Over Port of Darwin

Australia’s push to reclaim the Chinese-leased Port of Darwin has provoked threats of economic retaliation from Beijing. The dispute highlights the intersection of national security and trade, with potential sanctions and investment restrictions affecting broader Australia-China commercial relations.

Maritime services ban on crude

Brussels proposes banning EU shipping, insurance, finance and port services for Russian crude at any price, moving beyond the G7 price cap. If adopted, logistics will shift further to higher‑risk shadow channels, raising freight, delays, and legal liability.

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.

Strategic Trade Diversification Amid US Tariffs

India has rapidly signed FTAs with the UK, New Zealand, Oman, and the EU, reducing dependence on the US market amid high American tariffs. This diversification hedges against global trade fragmentation and enhances India’s leverage in global economic negotiations.

Export rebound and macro sensitivity

January exports hit a record $65.85bn (+33.9% y/y) and a $8.74bn surplus, led by semiconductors. Strong trade data supports industrial activity, but also increases sensitivity to cyclical tech demand, US trade actions, and won volatility—key for treasury, sourcing, and inventory planning.

Energy Sector Under Persistent Attack

Ukraine’s energy infrastructure faces repeated strikes, resulting in increased electricity imports and frequent outages. These disruptions raise operational costs for businesses, threaten industrial output, and necessitate investment in resilient and diversified energy solutions.

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.

Political Instability and Investment Uncertainty

France faces heightened political volatility following snap elections and a hung parliament, with far-right gains and government survival dependent on fragile coalitions. This instability is dampening investor confidence, delaying investment decisions, and complicating the business environment for both domestic and foreign firms.

Remittances and External Account Volatility

Remittances remain a critical source of foreign exchange, recently surpassing $41 billion annually. However, Pakistan’s current account remains vulnerable to shifts in remittance flows, export performance, and import demand, creating volatility that affects currency stability and investment confidence.

Suez Canal Security and Trade Disruptions

Despite partial recovery, Red Sea and Suez Canal traffic remains volatile due to ongoing regional security threats, especially Houthi attacks. This unpredictability disrupts global supply chains, increases insurance costs, and threatens Egypt’s vital foreign currency revenues.

Energy Transition and Fossil Fuel Policy

US energy policy is increasingly polarized, with federal calls to double oil output and expand LNG exports, while some states push renewables. This divergence creates uncertainty for energy-intensive industries and complicates long-term investment in both fossil fuels and green technologies.

Energy Transition And Renewables Expansion

Khanh Hoa and other provinces are advancing large-scale renewable energy projects, including wind, solar, and nuclear. National policies support the shift to green energy, grid stability, and green hydrogen, enhancing Vietnam’s energy security and export potential in the clean tech sector.

Currency Collapse and Hyperinflation

Iran's rial has plunged to record lows, now trading at 1.4–1.5 million per US dollar, with inflation nearing 50%. This currency crisis, driven by sanctions, mismanagement, and corruption, has triggered mass protests, eroded purchasing power, and created severe import and operational challenges for businesses.

Quality FDI and semiconductors

Registered FDI reached US$38.42bn in 2025 and realised FDI about US$27.62bn (highest 2021–25). Early-2026 approvals topped US$1bn in Bac Ninh and Thai Nguyen, with policy focus on semiconductors, AI, and higher value-added supply chains.

Pending Supreme Court Ruling on Tariff Authority

A forthcoming Supreme Court decision will determine the executive branch’s authority to impose sweeping tariffs. The outcome could reshape the US trade landscape, affecting the predictability of future trade policy and the legal environment for international business operations.

Critical Uncertainty Over War Settlement

Trilateral talks involving Ukraine, the US, and Russia signal possible movement toward a negotiated end to the conflict. However, the lack of clarity on security guarantees, territorial status, and enforcement mechanisms leaves businesses facing profound uncertainty over the future investment and operating environment.

Domestic semiconductor substitution drive

Accelerating localization in semiconductor equipment and materials, alongside constraints on advanced foreign tools, is reshaping vendor ecosystems. Multinationals face procurement displacement, IP exposure, and evolving partnership terms, while China-based fabs prioritize domestic suppliers and capacity.

Canada Pursues Strategic Trade Diversification

Canada is rapidly diversifying trade and investment partnerships, signing 12 new deals across four continents, including with China, the EU, and Qatar. This shift reduces reliance on the US market, but raises exposure to new geopolitical risks and regulatory complexities for international businesses.

Security threats to supply chains

Cargo theft, extortion and increasingly sophisticated freight fraud raise insurance costs and force changes to routing, warehousing and carrier selection. High-value lanes near industrial corridors and border crossings are most exposed, making security standards, tracking and vetted 3PLs essential.

Critical Minerals and Geopolitical Competition

Indonesia’s dominance in nickel and tin places it at the center of U.S.-China competition for critical minerals. While new trade frameworks with the U.S. offer market access, there are risks of resource dependency and the need for robust industrial policy to ensure domestic value addition and supply chain security.

Investment Deterrence and Capital Flight

The combination of sanctions, tariffs, and domestic instability has triggered capital flight and deterred new foreign investment. Regulatory uncertainty, payment blockages, and the risk of asset expropriation have made Iran an increasingly unattractive destination for international investors.