EU sustainability rules recalibrated

EU’s Omnibus I simplifies CSRD/CS3D: CSRD applies mainly to firms with >1,000 employees and >€450m turnover, while smaller suppliers gain a ‘value chain cap’ limiting data demands. Compliance costs shift upward to large groups, reshaping procurement and reporting expectations.

Steel protectionism and subsidies

New Steel Strategy targets raising domestic share from ~30% to up to 50%, backed by up to £2.5bn. Import quotas cut 60% and out‑of‑quota steel faces 50% tariffs from July, reshaping sourcing, project costs and localisation decisions.

Port capacity and hinterland connectivity

Cai Mep–Thi Vai handled 711,429 TEU in Jan 2026 (+9% y/y) with 48 weekly international services and capability for 24,000-TEU ships. New expressways and bridges aim to cut inland transit times, lowering logistics costs and improving resilience for exporters and manufacturers.

Foreign Business Regulatory Frictions

China’s operating environment remains difficult for international firms because of tighter controls over strategic sectors, data, technology and cross-border flows. Combined with selective market access and policy opacity, this raises due-diligence, compliance and localization costs for investors and multinational operators.

Trade Uncertainty Hits Exporters

Dutch exporters are facing sharper external volatility, with 50% of internationally active firms naming US trade policy as their top geopolitical concern. Around 30% report higher costs, nearly 20% lower US exports, complicating market planning, pricing and investment decisions.

US Trade Talks Face Uncertainty

India’s interim trade arrangement with the United States remains contingent on Washington’s evolving tariff architecture and Section 301 probes. Proposed US tariff treatment around 18% could still shift, complicating export planning, sourcing decisions, and investment assumptions for companies exposed to the US market.

Labor and Execution Risks

Large industrial investment plans face operational risks from labor tensions, including a possible Samsung union strike, and from project delays in defense and advanced manufacturing. Such disruptions could affect production continuity, customer delivery commitments, and capital spending timelines.

Strategic Industrial Upgrading Push

Taiwan is leveraging AI, semiconductors, drones, robotics, and advanced manufacturing to deepen trusted-partner supply chains. Strong inbound interest from Nvidia, AMD, Amazon, Google, and others supports opportunity, but also raises competition for talent, power, land, and industrial infrastructure capacity.

US-China Trade Probe Escalation

Beijing opened two six-month investigations into US trade barriers on March 27, targeting restrictions on Chinese goods, high-tech exports and green products. The move raises tariff, retaliation and compliance risks for exporters, manufacturers and investors exposed to US-China supply chains.

Power Grid Expansion Acceleration

Aneel’s latest transmission auction contracted R$3.3 billion of projects across 11 states, covering 798 km of lines and 2,150 MVA. Strong participation and steep bid discounts support grid reliability, industrial expansion and renewable integration, though delivery timelines extend 42-60 months.

Sanctions Volatility And Oil Flows

Iran’s oil exports have remained resilient despite sanctions and strikes, estimated around 1.6 million barrels per day in March, while temporary US licensing added further policy uncertainty. Businesses face abrupt compliance, pricing and contract risks as enforcement and exemptions shift unpredictably.

Power-grid expansion and LNG buildout

Rapid electricity demand is driving major grid and generation projects: GE Vernova plans a US$200m HVDC transformer plant in Hai Phong by 2028 and new LNG capacity (e.g., 1,600MW Hai Phong LNG targeting 2030). Grid readiness and fuel security will shape industrial reliability.

Governance, corruption and tender risk

Anti-corruption bodies pursued cases at a major defense plant (UAH 19m loss) and judicial/prosecutorial searches linked to €70m unfrozen abroad. Separately, lithium tender controversy highlights transparency concerns, increasing due‑diligence, reputational, and contract-enforcement risk.

Middle East conflict shipping disruptions

Escalation near the Strait of Hormuz is disrupting bookings and raising war-risk insurance for China-linked cargo. Some insurers may withdraw coverage; premiums and conflict surcharges are rising, and detours can add ~20 days, increasing working-capital needs and delivery uncertainty across corridors.

Nusantara Capital Investment Momentum

The new capital project continues attracting private commitments, with Rp1.27 trillion in fresh deals and Rp72 trillion from 57 companies by early 2026. This creates openings in construction, logistics, property, and services, though execution timing and policy continuity remain important variables.

Inflation and Shekel Pressure

Oil above $100 a barrel, a weaker shekel and fuel-price pressures threaten to lift inflation by about one percentage point, reducing chances of near-term rate cuts and increasing hedging, financing and pricing challenges for importers and exporters.

Tax administration and compliance risk

FBR revenue gaps (~Rs428bn in eight months) are pushing negotiations to lower the annual target to ~Rs13.45tr. Expect intensified audits, new levies (including on fuels) and ad‑hoc enforcement that can change landed costs and compliance burdens quickly.

Gümrük Birliği modernizasyon gündemi

‘Made in EU’ kapsamı tartışmaları Ankara’yı AB Gümrük Birliği’nin güncellenmesine odakladı. 2025’te AB-Türkiye ticareti ~233 milyar $’a ulaştı; ihracatın %43’ü AB’ye. Modernizasyon, hizmetler/tarım ve uyuşmazlık mekanizmalarıyla yatırım öngörülebilirliğini belirleyecek.

Business Compensation and Policy Intervention

The government is advancing compensation for war-affected businesses, property damage and reservist-related costs, while considering temporary fuel-tax cuts and dollar tax payments for exporters. These measures may ease short-term strain, but they also signal an increasingly interventionist and unpredictable policy environment.

Power investment needs surge

India’s power system is projected to expand from about 520 GW to 1,121 GW by 2035-36, requiring roughly $2.2 trillion in investment. This creates major opportunities in generation, grids, and storage, but also raises execution, financing, and regulatory risks for businesses.

USMCA review and tariff risk

USMCA renewal talks starting March 16 raise material uncertainty for duty-free access across $1.6T North American goods trade. Persistent U.S. tariffs (25% trucks; 50% metals; 17% tomatoes) and possible rule changes could disrupt pricing, compliance, and investment planning.

Export momentum with policy risk

Thai exports rose 9.9% year on year in February and 18.9% in the first two months of 2026, extending strong momentum after 12.9% growth in 2025. However, tariff front-loading and softer-than-expected February performance increase volatility for trade planning.

Fiscal Stress And State Extraction

Despite episodic oil-price windfalls, Russia faces widening fiscal strain, weak reserve buffers, and pressure to finance war spending. The state is increasing taxes, budget controls, and informal demands on large businesses, raising regulatory unpredictability and cash-flow pressure for firms still operating locally.

Monetary Policy Raises Financing Uncertainty

The Bank of England is expected to hold rates at 3.75%, but energy shocks could lift inflation toward 3.5% by late summer. Businesses face uncertain borrowing conditions, volatile sterling expectations, and more cautious capital allocation across investment, real estate, and consumer sectors.

Supply-Chain Trust Becomes Strategic

Taiwan’s role as a trusted technology and electronics hub depends increasingly on rigorous compliance, traceability and governance standards. Any breach involving sanctioned entities or diverted goods could damage supplier credibility, trigger foreign enforcement and reshape sourcing decisions by multinational customers.

Customs and Trade Facilitation

Cairo introduced temporary customs relief for transit cargo, waiving Advance Cargo Information pre-registration for three months and prioritizing clearance. The move may ease EU–Gulf trade disruptions and improve throughput at Egyptian ports, but also reflects continued volatility in routing, documentation, and cross-border supply-chain planning.

Middle East Conflict Raises Costs

The Middle East war is lifting oil and gas prices, weakening France’s growth outlook and increasing pressure on exposed sectors such as transport, fishing and chemicals. Businesses face higher input costs, renewed inflation risk, and uncertainty around government emergency support measures.

Suez Canal security shock

Red Sea and Gulf conflict perceptions are cutting Suez Canal traffic and toll income, with Egypt citing about $10bn lost and experts warning ~50% traffic declines. Higher war-risk premiums and rerouting raise lead times and costs for shippers, traders, and manufacturers.

Sanctions Enforcement Shapes Trade Risks

Sanctions on Russia remain central to Ukraine’s commercial environment, but evasion through third countries and imported components still sustains Russian military production. Companies trading across the region face heightened compliance, end-use screening and reputational risks tied to dual-use goods and logistics networks.

Nearshoring Momentum Faces Investment Pause

Mexico remains a preferred North American manufacturing platform, yet companies are delaying new commitments until trade and regulatory conditions clarify. Executives describe nearshoring as in an impasse, as uncertainty over USMCA rules, tariffs and market access slows plant, supplier and logistics expansion.

Cambodia Border Disruption Risk

Fragile ceasefire conditions with Cambodia continue to threaten cross-border commerce, transport routes and border-area operations. Nationalist politics, unresolved claims along the 800-km frontier and periodic closures increase uncertainty for regional supply chains, trucking, agribusiness trade and frontier industrial activity.

Trade Barriers Raise Operating Costs

German firms report a broad deterioration in external operating conditions as geopolitical tensions and protectionism increase freight, compliance and customs costs. In a DIHK survey, 69% said new trade barriers were hurting international business, the highest share since 2005.

Red Sea Logistics Hub Expansion

Saudi authorities launched logistics corridors and new shipping services through Jeddah and other Red Sea ports, with western port capacity above 18.6 million TEUs, strengthening Saudi Arabia’s role as a regional rerouting hub for GCC cargo.

Automotive Market Rules Are Shifting

Australia will liberalise access for EU passenger vehicles and raise the luxury car tax threshold for EU electric vehicles to A$120,000, exempting about 75% of them and increasing competitive pressure across auto retail, fleet procurement and charging-related supply chains.

Security and Water Stress Risks

Operational risk is elevated by insecurity and resource stress. The OECD estimates insecurity reduces potential growth by 1–2 percentage points annually, while worsening water scarcity and leakage losses of up to 46% threaten manufacturing continuity, site selection and logistics reliability in key industrial regions.

Nearshoring capacity and industrial parks

Plan México is scaling industrial real estate: the first 20 of 100 planned parks opened with US$711m investment and 3.5m m² capacity, targeting automotive, electronics, aerospace and logistics. Benefits depend on permits, utilities, and local security and labor availability.