Inflation and rate pressure

July inflation slowed to 31.75% annually, yet monthly prices accelerated and emergency tightening pushed funding costs toward 40%. Persistently high inflation, expensive energy imports, and lira pressure complicate pricing, financing, hedging, and capital allocation for firms operating in Turkey.

Municipal energy costs pressure firms

Nelson Mandela Bay’s disputed electricity tariff changes, including a 10.95% increase and removal of subsidised block tariffs, have sharply raised bills for households and small firms. Continued local tariff and outage pressures can erode margins, pricing competitiveness, and investment attractiveness.

CUSMA Review Uncertainty Deepens

The U.S. refusal to renew CUSMA outright has triggered rolling annual reviews and extended renegotiation uncertainty. Businesses face weaker visibility on market access, rules, and tariff exposure, which is already discouraging long-term capital allocation and supply-chain commitments.

Rising JGB Yields Spillover

Japanese government bond yields have climbed sharply, with 10-year yields cited near 2.9% and broader yield pressure feeding worries about global bond-market contagion. Higher domestic yields may reprice financing conditions, affect bank balance sheets, and alter portfolio flows across regions.

Alternative corridor expansion plans

Saudi Arabia is optimizing and considering expanding its East-West pipeline toward 9 million barrels per day, while exploring additional bypass options through Egypt and other corridors. These moves could reshape regional supply chains, infrastructure investment priorities and long-term energy trade patterns.

Agriculture pricing and forecast shock

Port disruptions are depressing Ukrainian farmgate prices while reducing export outlooks. Domestic grain prices have dropped more than 30%, and Kyiv cut its 2026-27 grain export forecast to 38-40 million tons from 43 million, weakening agribusiness margins and investment confidence.

Suez route security shock

Drone strikes near Damietta and persistent Houthi threats have elevated security risks around the Suez Canal and SUMED pipeline, critical trade arteries. Higher war-risk premiums, vessel rerouting, and possible disruption to oil and container flows could raise global freight and insurance costs.

Alternative routes under strain

Ukraine is expanding EU Solidarity Lanes and negotiating a Moldova-Romania rail corridor, potentially handling 4.5 million tonnes annually, but land, Danube, and rail routes remain costlier and capacity-constrained, limiting their ability to replace deep-water port logistics for bulk trade.

Trade Policy Drives Election

Tariffs have become a central midterm campaign issue, with Republicans defending them as pro-manufacturing and Democrats blaming them for higher consumer prices. Politicization of trade policy raises the likelihood of rapid post-election adjustments affecting investment and sourcing strategies.

US Tariff Dispute Escalation

Brazil’s WTO case against new US Section 301 tariffs is now the top trade risk. Measures of 25% and 12.5% affect 23.1% of exports to the US, with 16.5% facing a combined 37.5% surcharge, raising costs and uncertainty.

Security threats to Chinese projects

Escalating militant attacks in Balochistan are undermining CPEC execution, mining operations and infrastructure viability. The BLA reportedly conducted over 100 attacks in 2024’s first half, increasing insurance, personnel protection and project delay risks for foreign operators and contractors.

Regional conflict drives security risk

Ongoing multi-front conflict continues to reshape Israel’s business environment, with article data citing about 17,000 projectiles from Gaza, nearly 13,000 from Lebanon and roughly 1,150 Iranian missiles, raising operating, insurance, logistics and investment-risk costs.

CUSMA Renewal Uncertainty Grows

Current tariff bargaining is increasingly linked to the future of CUSMA, with review timelines slipping and US commitment to renewal unclear. Businesses therefore face prolonged uncertainty over North American trade rules, tariff treatment and the durability of regional manufacturing strategies.

Manufacturing Recovery With Constraints

South Korea’s July manufacturing PMI rose to 53.1 from 52.1, with export orders growing at their fastest pace since April 2021, led by autos and semiconductors. Yet supplier delays tied to Middle East conflict show that operating conditions remain vulnerable despite improving demand.

USMCA Review Creates Prolonged Trade Uncertainty

The Trump administration declined to extend USMCA for 16 years, imposing annual reviews until 2036. Investment announcements dropped ~80% in Q1 2026 as negotiations stall on automotive rules of origin and energy access, with a fourth round set for September.

Australia trade and energy links grow

Vietnam’s economic relationship with Australia is expanding quickly, with two-way trade reaching $30 billion in 2025. Its role in fuel and raw-material flows strengthens Vietnam’s position in regional supply chains and offers investors broader export, energy-security, and industrial partnership opportunities beyond traditional markets.

US tensions hit trade confidence

Court challenges to the Expropriation Act and reported US tariffs and aid withdrawal have sharpened bilateral friction, raising policy-risk perceptions for exporters and investors. The dispute adds uncertainty around property rights, market access, and South Africa’s broader external economic positioning.

Legal Challenges Cloud Tariffs

The U.S. used Section 338 of the 1930 Tariff Act, a provision reportedly never before used for tariffs and viewed by legal experts as vulnerable in court. That legal uncertainty complicates pricing, contracting, and capital-allocation decisions for firms exposed to bilateral trade.

European capital gains importance

Amid global economic fragmentation, South Africa is seeking more diversified partnerships, including French investment pledges worth EUR 1.11 billion and talks on transport infrastructure and civilian nuclear energy. For foreign firms, this points to new co-investment channels and sector-specific collaboration.

Tighter foreign investment screening

France lowered the review threshold for non-EU investors in sensitive listed companies from 25% to 10%, covering firms listed outside the EU. Faster 10-day initial reviews may protect strategic assets but increase deal uncertainty in defense, AI, semiconductors and infrastructure.

Migration policy uncertainty affects labour

Migration remains economically important for Australian employers, especially as one in three workers in healthcare, logistics, professional services and manufacturing are overseas-born. Yet falling net migration and proposed tighter visa rules create uncertainty for labour availability, skills pipelines and expansion planning.

Auto Supply Chains Vulnerable

Autos remain a critical flashpoint, with current US tariffs at 25% on non-US content and proposals of 10-15% even for CUSMA-compliant trade. Given roughly half of Canadian vehicle value is US components, manufacturers face significant restructuring pressure.

US tariff and transshipment risk

US customs inspections of Chinese-linked factories in Vietnam and stalled bilateral talks over transshipment, IP, and non-tariff barriers have raised the risk of additional Section 301 tariffs, threatening exporters, compliance costs, and sourcing strategies for Vietnam-based manufacturing.

Renewable Energy Strategy Targeting 45% by 2028

Egypt's national strategy targets 45% renewable energy in the power mix by 2028, backed by 5 trillion EGP in sector investments since 2014. The EU pledged $794 million for grid modernization, while government initiatives support industrial solar transition and battery manufacturing localization.

US-China Trade Retaliation Broadens

Beijing expanded retaliation with drone export controls, sanctions on seven US entities, and its first foreign trade national security investigation, signaling a more operational legal toolkit that can disrupt cross-border trade, licensing, sourcing decisions, and compliance planning for multinationals.

Ports and airports enter sanctions net

The EU imposed transaction bans on two Russian ports and four airports, including Sheremetyevo, restricting services, software, consulting, handling and infrastructure dealings. This raises operational barriers for cargo routing, aviation-linked trade and logistics support into Russia.

Fed uncertainty raises financing costs

The Federal Reserve held rates at 3.5%-3.75%, but a 9-3 split and persistent inflation have kept tightening risks alive. Markets cut the probability of a September hike from nearly 60% to about 40%, preserving uncertainty for borrowing, capex and valuations.

Infrastructure Damage Raises Costs

US strikes and broader conflict have reportedly hit power infrastructure, petrochemical complexes, and logistics nodes, while container shipping from China to Iran rose to about $9,000, roughly triple pre-war levels. This raises fulfillment costs and undermines industrial and import reliability.

Arctic route trade realignment

The Northern Sea Route is becoming a seasonal Russia-China trade corridor, with at least six Chinese shipping firms planning more than 50 voyages and some China-Europe sailings advertised at 18 to 20 days, though sanctions and insurance risks remain high.

Political Transition Raises Policy Volatility

The arrival of Prime Minister Andy Burnham opens possible shifts in devolution, industrial policy, infrastructure and EU relations, but also adds uncertainty. Leadership change amid weak growth and contested policy priorities can delay investment decisions and complicate long-term operating assumptions.

Israel trade restriction risk

The government is considering bans on goods from illegal Israeli settlements and possibly some military exports. Businesses face potential legal and reputational exposure, while critics warn that over-compliance could disrupt wider Israel-linked trade flows, including pharmaceutical supplies important to the NHS and procurement planning.

Macroeconomic strain constrains business

Fuel shortages, weaker growth, and tighter financing are compounding pressure on Russian businesses, with GDP growth forecasts cut to 0-1%, inflation projected at 6-7%, and higher VAT and borrowing costs worsening margins, cash flow, and investment conditions.

Nickel sector financial stress

Layoffs affecting about 1,900 workers at Gunbuster Nickel Industry in North Morowali highlight financial and operational fragility inside parts of Indonesia’s nickel ecosystem. The company’s debt moratorium process and efficiency measures signal possible disruptions for suppliers, contractors and local consumption-linked businesses.

Tech talent incentives expand

Israel is using time-limited hi-tech tax reforms through end-2026 to attract returning professionals and global skilled workers. The measures address equity compensation and cross-border taxation, aiming to relieve talent shortages in AI, cybersecurity, semiconductors and digital health industries.

Polysilicon protection reshapes supply chains

A new Section 232 proclamation places a 15% tariff and minimum import prices on polysilicon, wafers, cells and modules, effective December 4. The policy aims to localize semiconductor and solar inputs, but may raise import costs and trigger pre-deadline stockpiling.

China Ties Deepen Investment

Thailand and China signed cooperation agreements spanning trade, customs, AI, aviation and intellectual property, while Thai officials discussed more than 70 billion baht of Chinese investment in precision industries and advanced technology, reinforcing Thailand’s role in regional manufacturing, EV and technology supply chains.