Carbon pricing and green finance

Cabinet approved carbon credits, allowances and RECs as TFEX derivatives reference assets, anticipating a Climate Change Act with mandatory caps and pricing. Firms face rising compliance expectations, new hedging tools, and stronger ESG disclosure demands across supply chains and financing.

Defense rearmament boosts demand

Germany is accelerating procurement, including a €536m first tranche of loitering munitions within a €4.3bn framework and NATO long-range drone initiatives. This supports select industrial orders and dual-use tech investment, but tightens export controls, compliance, and supply competition for components.

Cybersecurity and hybrid interference exposure

Taiwan’s critical infrastructure faces persistent cyber and influence operations alongside military ‘grey-zone’ pressure. Multinationals should anticipate higher compliance expectations, stronger incident-reporting norms, and increased operational spending on redundancy, supplier security, and data integrity.

Industrial decarbonisation via CCUS

The UK is moving carbon capture from planning to build-out: five major CCUS projects reached financial close, with over 100 projects in development and potential 100+ MtCO₂ storage capacity annually by mid‑2030s. Policy clarity and funding pace will shape investment, costs, and competitiveness for heavy industry.

Trade frictions and border infrastructure

Political escalation is spilling into infrastructure and customs risk, highlighted by threats to block the Gordie Howe Detroit–Windsor bridge opening unless terms change. Any disruption at key crossings would materially affect just-in-time manufacturing, warehousing costs, and delivery reliability.

Fiscal volatility and higher taxes

Le budget 2026 est adopté via 49.3, dans un contexte de majorité introuvable. Déficit visé à 5% du PIB, dette projetée à 118,2% et surtaxe sur grandes entreprises (7,3 Md€) augmentent le risque de changements fiscaux rapides.

Tech resilience amid talent outflow

Israel’s tech sector remains pivotal (around 60% of exports) but faces brain-drain concerns, with reports of ~90,000 departures since 2023. Continued VC activity and large exits support liquidity, yet hiring constraints and reputational risk can affect scaling and site-location decisions.

Semiconductor Industry Expansion and Resilience

Massive investments, including TSMC’s Kumamoto project, are transforming Japan’s semiconductor sector, with 6.2 trillion yen projected by 2030. This shift, driven by AI demand and 'de-China' strategies, positions Japan as a key global hub, attracting supply chain partners and foreign capital.

Persistent Foreign Exchange Pressures Remain

Egypt continues to face significant foreign exchange challenges, with external debt rising to $161.2 billion and a debt-to-GDP ratio of 44.2%. These pressures impact import costs, repatriation of profits, and overall business confidence, affecting international investment strategies.

Mining Sector Emerges as Strategic Pillar

Saudi Arabia is investing $110 billion to develop its $2.5 trillion mineral reserves, including rare earths, gold, and copper. The Kingdom seeks to become a regional processing hub, partnering with US firms and reducing global supply chain dependence on China for critical minerals.

Post-election policy continuity risks

Bhumjaithai’s strong election showing reduces near-term instability, supporting portfolio inflows, but coalition bargaining and a multi-year constitutional rewrite could still delay budgets and reforms. Foreign investors face execution risk around stimulus, infrastructure procurement, and regulatory priorities.

Digital infrastructure and data centers

A proposed 20-year tax holiday plus GST/input relief aims to attract foreign data-center and cloud investment, targeting fivefold capacity growth to 8GW by 2030. Multinationals face opportunities in AI/5G ecosystems alongside evolving localization, energy and permitting constraints.

Outbound investment screening expansion

U.S. rules restricting outbound investments into sensitive sectors (semiconductors, AI, quantum and related capabilities) are tightening board-level approvals and reporting. Multinationals must redesign China exposure, restructure JV/VC activity, and document controls across affiliates and funds.

Energy diversification and LNG capacity build

Turkey is scaling LNG supply and infrastructure: new long-term contracts (including U.S.-sourced LNG) and plans to add FSRUs aim to lift regasification toward 200 million m³/day within two years. This improves energy security but exposes firms to LNG price volatility.

Industrial policy and subsidy conditions

CHIPS Act and IRA-era incentives keep steering investment toward U.S. manufacturing and clean energy, often with domestic-content, labor, and sourcing requirements. This reshapes site selection and supplier qualification, while creating tax-credit transfer opportunities and compliance burdens for global operators.

Weaponization of Trade and Supply Chains

US trade policy is increasingly driven by geopolitical considerations, with tariffs, sanctions, and export controls used as strategic tools. This shift from efficiency to security heightens supply chain fragility, risk aversion, and the need for resilience in global business operations.

Domestic unrest and operational disruption

Mass protests and a severe security crackdown have disrupted commerce, port operations, and logistics, with intermittent internet restrictions. Companies face heightened workforce, physical security and continuity risks, plus reputational exposure from human-rights concerns and sanctions-linked counterparts.

Supply Chain Resilience Amid Global Disruptions

Global supply chains remain in a state of permanent disruption due to geopolitical tensions, trade realignments, and energy volatility. Finnish businesses are adapting by diversifying sourcing and investing in digital infrastructure, but exposure to external shocks remains a critical risk factor.

China Exposure and Supply Chain Risks

German industry’s deep integration with China, especially in automotive and high-tech sectors, creates strategic vulnerabilities. Recent government commissions highlight growing awareness, but slow policy action leaves supply chains and critical infrastructure exposed to geopolitical shocks and Chinese competition.

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.

Regional Security Tensions and Military Posturing

US military deployments, threats to the Strait of Hormuz, and Iran’s support for regional proxies elevate the risk of conflict. Any escalation could disrupt global energy flows and insurance costs, directly impacting supply chains and investment risk assessments.

Regional war and security risk

Gaza conflict and spillovers (Lebanon, Iran proxies) keep Israel’s risk premium elevated, raising insurance, freight, and business-continuity costs. Mobilization and security alerts disrupt staffing and site access, while renewed escalation could rapidly impair ports, aviation, and cross-border trade.

Expanded secondary sanctions via tariffs

Washington is blending sanctions and trade tools, including a proposed blanket 25% tariff on imports from any country trading with Iran. This “long-arm” approach raises compliance costs, forces enhanced supply-chain due diligence, and increases retaliation and WTO-dispute risk for multinationals.

NATO demand for simulation

Finland’s expanding NATO role—hosting a Deployable CIS Module and accelerating defence readiness—supports sustained demand for secure training, synthetic environments and mission rehearsal. This can pull in foreign primes and SMEs, while tightening cybersecurity, export-control and procurement compliance expectations.

Won volatility and FX backstops

Authorities issued $3bn in FX stabilization bonds as reserves fell to about $425.9bn and equity outflows pressured KRW. Elevated USD/KRW volatility affects import costs, hedging budgets, and repatriation strategies, especially for commodity buyers and dollar-funded projects.

Risco fiscal e trajetória da dívida

Gastos federais cresceram 3,37% acima do teto real de 2,5% em 2025 e o déficit primário ficou em 0,43% do PIB; a dívida bruta chegou a 78,7% do PIB, elevando risco-país, câmbio e custo de capital.

Targeted Sectoral Trade Actions

Beyond country tariffs, the U.S. is signaling sector-focused measures (autos, steel/aluminum, aerospace certification disputes) that can abruptly disrupt specific industries. Companies should expect episodic shocks to cross-border flows, inventory strategy, and after-sales service for regulated products.

Critical minerals alliance reshaping

Washington is building a “preferential” critical-minerals trade zone with price floors and stockpiling, pressuring partners to align and reduce China exposure. Canada’s positioning will affect mining, refining, battery investment and eligibility for U.S.-linked supply chains.

Foreign Investment Scrutiny Intensifies

Australian authorities are tightening scrutiny of foreign investment, especially in strategic sectors like rare earths. Recent government actions to force divestment of Chinese-linked stakes in Northern Minerals reflect heightened national interest concerns, affecting deal certainty for international investors.

US tariff shock and reorientation

Reports indicate a steep US reciprocal tariff (cited at 36%) has raised urgency for export diversification, local value-add, and BOI support measures. Firms face margin pressure, potential order diversion, and renewed interest in rules-of-origin planning and US-facing compliance.

Nickel quota cuts, ore scarcity

Indonesia is slashing nickel ore RKAB quotas—targeting ~250–260m wet tons vs 379m in 2025—and ordering major mines like Weda Bay to cut output. Smelters may face feedstock deficits, driving imports (15.84m tons in 2025) and price volatility.

Capital Controls Tighten Amid Fiscal Strain

New regulations require declarations for cash exports over $100,000 and restrict gold bar movements. These controls aim to curb capital flight, increase transparency, and stabilize the ruble, but may deter foreign investment and complicate international financial operations in Russia.

Rising funding costs, liquidity swings

Short-term liquidity tightened around Tet, pushing interbank rates sharply higher and prompting widespread deposit-rate hikes; Agribank lifted longer tenors up to 6%. Higher financing costs can squeeze working capital, pressure leveraged sectors, and raise hurdle rates for projects.

Rail-border bottlenecks and gauge mismatch

Efforts to integrate Ukraine’s rail with EU networks highlight structural constraints: different track gauges require transshipment at borders, creating durable chokepoints. Any surge in exports or reconstruction imports can overwhelm terminals, extending lead times and pushing firms to diversify routing via Danube and road.

Energy transition supply-chain frictions

Rising restrictions and tariffs targeting Chinese-origin batteries and energy storage (e.g., FEOC rules, higher Section 301 tariffs) are forcing earlier compliance screening, origin tracing, and dual-sourcing—impacting project finance, delivery schedules, and total installed costs globally.

Export Controls on AI Compute

Evolving Commerce/BIS restrictions on advanced AI chips and related technologies are tightening licensing, end‑use checks, and due diligence. Multinationals must segment products, manage re‑exports, and redesign cloud/AI deployments to avoid violations and sudden shipment holds in sensitive markets.