Mission Grey Daily Brief - February 10, 2025
Summary of the Global Situation for Businesses and Investors
The global situation is marked by geopolitical tensions and economic uncertainty. President Donald Trump has implemented a series of policies that have significant implications for international relations and global trade. The war in Ukraine continues to escalate, with North Korea supporting Russia and a Russian oligarch warning of a potential world war. Trump's policies have also impacted allies such as Canada, Mexico, and Australia, as well as rivals like China. Trump's tariffs and trade policies have disrupted supply chains and increased costs for consumers and businesses. Trump's actions have also strained relations with allies and rivals, creating a volatile and unpredictable environment for businesses and investors.
Trump's Tariffs and Trade Policies
President Donald Trump has implemented a series of tariffs and trade policies that have significant implications for international relations and global trade. Trump's tariffs have disrupted supply chains and increased costs for consumers and businesses. Trump's tariffs on China have impacted the pharmaceutical industry, as China supplies the U.S. with approximately 30% of its active pharmaceutical ingredients. Trump's tariffs could lead to shortages or increased costs of generic drugs, putting patients at risk. Trump's tariffs have also impacted Ireland, which is highly exposed to U.S. trade policies due to historic links and an industrial policy that has relied on tax measures attractive to U.S. multinational corporations. Ireland collects much of the corporate tax revenue that a more coherent U.S. tax code would channel back across the Atlantic. Trump's tariffs have also impacted Canada, which is highly integrated with the U.S. auto industry and relies on Canada's heavier crude oils. Trump's tariffs have disrupted supply chains and increased costs for Canadian businesses and consumers. Trump's tariffs have also impacted Mexico, which is highly integrated with the U.S. auto industry and relies on Mexican labor for manufacturing. Trump's tariffs have disrupted supply chains and increased costs for Mexican businesses and consumers. Trump's tariffs have also impacted Australia, which is highly integrated with the U.S. steel and aluminum industry. Trump's tariffs have disrupted supply chains and increased costs for Australian businesses and consumers.
The War in Ukraine and North Korea's Involvement
The war in Ukraine continues to escalate, with North Korea supporting Russia and a Russian oligarch warning of a potential world war. North Korea has sent thousands of soldiers to fight alongside Russian troops, resulting in heavy losses for both sides. A Russian oligarch, Andrey Melnichenko, has warned that a world war could follow if <co:
Further Reading:
Chinese construction risks turning the Yellow Sea into a flashpoint - Business Insider
Elite North Korean troops return to the fight after devastating battlefield losses - New York Post
Putin Ally Warns Trump Escalation in Ukraine 'Will Lead to a World War' - Newsweek
They helped the US fight the Taliban. Now Trump has left these Afghans stranded - The Independent
Trump is intensifying his trade war. Australia may not be immune - Sydney Morning Herald
Trump will formally announce steel and aluminum duties Monday, including on Canada - Toronto Star
Themes around the World:
Fuel Regulation, Security, and Energy Transition
Brazil is intensifying fuel regulation, updating tariffs, and promoting biogas and sustainable aviation fuel. However, fuel theft in pipelines is rising, especially in São Paulo, posing operational and security risks. The energy transition agenda is advancing, but regulatory and enforcement challenges remain.
Supply Chain Resilience and Innovation
China is transforming its supply chains through digitalization, AI-driven logistics, and overseas production hubs. These innovations enhance resilience and efficiency but also create new competitive pressures and require adaptation by multinational partners.
Major Infrastructure and Digital Expansion
India’s infrastructure financing is integrating with global capital markets, focusing on green, resilient, and tech-enabled projects. Data center capacity doubled in 2025, with projections to triple by 2030, supporting digital transformation and robust supply chain logistics.
Vision 2030 Giga-Projects Acceleration
Saudi Arabia’s giga-projects, such as Qiddiya and NEOM, are advancing rapidly, with major infrastructure and entertainment investments. These projects aim to diversify the economy, create up to 85,000 jobs by 2030, and generate significant non-oil revenue, attracting global investors and supply chain partners.
Workforce Development and Talent Mobility
Industrial growth and nearshoring are driving demand for skilled labor, prompting national upskilling initiatives. TN visas facilitate Mexican talent mobility to the US, while labor shortages and wage pressures in both countries are reshaping hiring strategies and operational models.
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.
US-Australia Strategic Minerals Partnership
Australia and the US have deepened cooperation on critical minerals, with multi-billion-dollar funding and joint ventures. This partnership supports supply chain diversification for Western industries, boosts investment opportunities, and reduces exposure to geopolitical shocks from China.
Rising Poverty and Socioeconomic Instability
With poverty rates approaching 45% and unemployment at 7.1%, Pakistan faces severe socioeconomic challenges. This environment increases operational risks, affects consumer demand, and may trigger policy shifts or social unrest impacting business continuity and investment strategies.
Semiconductor Sector Faces Geopolitical Pressure
South Korea’s semiconductor industry is under pressure from evolving US tariff policies and investment demands, as well as competition with Taiwan for favorable US trade terms. These dynamics threaten Korea’s global market share and could force further US-based investment by Korean firms.
Surge in Used EV Market Drives Battery Reuse
France’s used electric vehicle market grew 30% in 2025, with battery longevity and second-life applications now critical. This trend boosts demand for battery reuse solutions, influencing investment strategies and the structure of aftersales and recycling supply chains.
Security Guarantees as Investment Prerequisite
International investors and financial institutions stress that credible security guarantees are essential for large-scale investment in Ukraine. Ongoing conflict and uncertainty over territorial concessions remain major obstacles, with capital inflows contingent on a stable, enforceable peace framework.
US-Saudi Relations and Security Realignment
Saudi Arabia is recalibrating its security partnerships, balancing US ties with new regional alliances and arms deals with Pakistan. Diverging interests with Washington and assertive regional diplomacy reflect a more independent Saudi foreign policy, affecting the risk calculus for Western businesses.
Escalating Political Instability and Protests
Iran is experiencing its most significant unrest since 1979, with over 2,500 deaths and 18,000 arrests reported. The protests, sparked by economic collapse and currency devaluation, have evolved into direct challenges to the regime, severely impacting business confidence and operational continuity.
Strategic Energy Dependency on US LNG
Germany’s rapid shift from Russian to US LNG has created a new energy dependency, with 96% of LNG imports now sourced from the US. This exposes German industry to US political leverage, price volatility, and long-term risks to energy sovereignty and cost competitiveness.
Accelerated Economic Reform Agenda
Vietnam’s leadership has committed to sweeping economic and administrative reforms, targeting over 10% annual GDP growth through 2030. This includes bureaucratic streamlining, private sector empowerment, and innovation, with significant implications for investment climate and business operations.
Circular Economy Initiatives Gain Momentum
France is advancing circular economy models for EV batteries, with startups and industrial players piloting second-life and recycling projects. These initiatives are increasingly supported by public policy, enhancing resource efficiency and opening new business models for investors.
Political Volatility and Diplomatic Strategy
President Sheinbaum’s approach to US relations emphasizes dialogue, sovereignty, and adaptability in the face of unpredictable US policy shifts. Ongoing communication with President Trump and Canadian leaders is crucial for maintaining trade stability and managing bilateral crises.
Broader Regional Economic Realignment
China’s selective engagement with South Korea and other regional actors amid Japan tensions signals a shifting economic landscape. Businesses must navigate evolving alliances, trade blocs, and competitive pressures across East Asia.
US-Israel Strategic Partnership and Aid
The US continues to provide substantial military and economic aid to Israel, reinforcing bilateral ties and defense cooperation. This partnership underpins Israel’s security posture but also shapes the regulatory and sanctions environment, influencing international investment and technology transfer.
EU-Mercosur Free Trade Agreement
The historic EU-Mercosur agreement, signed in January 2026, eliminates tariffs on over 90% of trade between Brazil and the EU, creating the world’s largest free trade area. This is expected to boost Brazilian GDP by €6 billion by 2044, expand exports, and attract investment, but also introduces European regulatory and sustainability standards.
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.
Declining Foreign Investment and Policy Uncertainty
Foreign direct investment dropped 82% year-on-year, reflecting high taxes, inconsistent regulation, and bureaucratic inefficiencies. The Special Investment Facilitation Council (SIFC) aims to streamline approvals, but investor confidence remains fragile, impacting long-term capital flows and supply chain decisions.
EU Customs Union Modernization Stalled
Despite strong business and diplomatic calls to update the EU-Turkey Customs Union, negotiations remain stalled. The outdated framework limits Turkey’s access to EU markets for services and agriculture, constraining trade growth and supply chain expansion for international firms.
Infrastructure Expansion Faces Local Resistance
Major infrastructure and tech projects, such as Nvidia’s Kiryat Tivon campus, are transforming Israel’s economic landscape. However, local opposition, concerns over land use, and social tensions may delay projects, increase costs, and complicate stakeholder engagement for international investors and operators.
Macroeconomic Stabilization and Investor Confidence
The Egyptian pound has appreciated, inflation slowed to 12.3%, and remittances rose 42.5% to $37.5 billion. These improvements, alongside rising FDI and portfolio inflows, reflect cautious optimism but remain vulnerable to external shocks and reform momentum.
Regulatory Uncertainty and National Security
China’s regulatory environment has become more unpredictable, with heightened enforcement on national security, technology, and data. Foreign businesses face stricter compliance requirements, greater scrutiny, and potential exposure to sudden policy shifts, impacting investment and operational planning.
Declining Indian Demand for Russian Oil
Indian refiners are reducing Russian oil imports due to sanctions, compliance complexities, and a shift toward Middle Eastern suppliers. This trend impacts Russia’s export revenues and alters global crude trade patterns, while increasing supply chain and regulatory risks for energy sector stakeholders.
Shifting Trade Partnerships and Flows
Traditional buyers like India and Turkey have reduced Russian oil imports due to sanctions, while China remains the top buyer. These shifts are altering established trade routes, impacting pricing, and increasing uncertainty for global importers and exporters.
Regional Integration and Trade Bloc Leverage
South Africa leverages its role in the African Continental Free Trade Area and regional infrastructure to position itself as a gateway to Africa. This enhances supply chain diversification and trade opportunities, but also requires continued investment in logistics and regulatory harmonization.
Environmental Compliance as Trade Imperative
The EU-Mercosur deal links trade privileges to climate commitments, including adherence to the Paris Agreement and bans on products linked to deforestation. Non-compliance could trigger trade suspensions, making environmental governance a critical factor for exporters and investors in Brazil.
Privatization and Investment in Key Sectors
Privatization of state-owned enterprises, airports, and power companies is accelerating, with strong interest from global investors. This shift aims to unlock efficiency, attract FDI, and modernize infrastructure, but success depends on transparent processes and policy continuity.
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.
Supply Chain Resilience and Diversification
Japan’s government and industry are accelerating efforts to diversify supply chains for critical minerals, semiconductors, and pharmaceuticals. Recent G7-led initiatives and domestic innovation aim to reduce strategic vulnerabilities exposed by geopolitical shocks and export controls.
Regulatory Uncertainty and Investment Delays
Ongoing legal challenges to US tariffs and Korea’s legislative process for outbound investment funds delay the execution of major bilateral trade and investment agreements. This regulatory uncertainty complicates strategic planning for multinational firms operating in or with South Korea.
US Tariffs Spark Transatlantic Crisis
President Trump’s imposition of 10–25% tariffs on UK goods over the Greenland dispute marks a severe escalation in US-UK trade relations. The move threatens UK exports, supply chains, and could trigger recessionary pressures and retaliatory action from the EU, heightening business uncertainty.
Labor Market and Demographic Dynamics
Vietnam’s young, growing workforce underpins its manufacturing competitiveness. However, wage pressures, skills shortages, and the need for digital upskilling are emerging challenges. Labor market reforms and social stability are essential for maintaining cost advantages and attracting long-term investment.