Decarbonisation incentives for heavy industry

A new A$321m grants round under the Powering the Regions Fund supports Safeguard Mechanism covered facilities to cut emissions, funding up to 50% of project costs. It boosts demand for clean-tech, electrification and low-carbon materials while increasing compliance expectations for high emitters.

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.

Digital regulation and platform compliance risk

Proposed online-platform and network rules, plus high-profile cases involving major platforms, are viewed in Washington as discriminatory. Potential policy shifts could alter data governance, content delivery costs, and competition enforcement, influencing market entry strategy and compliance budgets for multinationals.

Automotive transition and investment flight

VDA reports 72% of 124 suppliers are delaying, cutting or relocating German investment; employment fell from 833k (2019) to 726k (2025). EV incentives may depress used values and dealer margins, while CO₂-rule uncertainty complicates capex and sourcing decisions.

Ports and logistics corridor expansion

Egypt is building seven multimodal trade corridors, expanding ports with ~70 km of new deep-water berths and scaling dry ports toward 33. A new semi-automated Sokhna container terminal (>$1.8bn) improves throughput, but execution and tariff predictability matter.

Rail logistics reforms and PPPs

Freight rail and ports are opening cautiously to private operators, with Transnet conditionally allocating slots to 11 operators and targeting 250Mt by 2030. However, stalled legislation and unresolved third-party access tariffs keep exporters exposed to bottlenecks, demurrage, and modal shift costs.

Immigration tightening strains labour

Visa and sponsor-licence enforcement is intensifying, with policy moving to end care-worker visas by 2028 and continued restrictions on overseas recruitment. Sectors reliant on migrant labour face staffing risk, wage pressure, and service disruption, pushing automation, outsourcing, and location strategy reviews.

Rupee flexibility and policy transmission

RBI reiterates it won’t defend a rupee level, intervening only against excessive volatility; rupee touched ~₹90/$ in Dec 2025. For importers/exporters, hedging discipline and INR cost pass-through matter as rates stay on hold and liquidity tools drive conditions.

Logistics hub buildout surge

Saudi Arabia is accelerating the National Transport and Logistics Strategy via port upgrades, transshipment growth and new logistics zones. January throughput reached 738,111 TEUs (+2% YoY) with transshipment up 22%. This improves regional routing options but raises competition and compliance demands.

EU battery regulation compliance burden

EU Batteries Regulation requirements—carbon footprint calculation and disclosure, due diligence and upcoming battery passports—raise data, auditing and IT costs across French supply chains. Non-compliance risks market access, while compliant producers can differentiate via lower-carbon nuclear-powered output.

Rising defence spending and procurement

Germany is accelerating rearmament with major outlays (e.g., €536m initial loitering‑munitions order within a €4.3bn framework; broader funding exceeding €100bn). This boosts defence-tech opportunities but heightens export-control, security and supply‑capacity constraints.

Sanctions escalation and enforcement

EU’s proposed 20th package expands beyond price caps toward a full maritime-services ban for Russian crude, adds banks and third-country facilitators, and tightens export/import controls. Compliance burdens, secondary-sanctions exposure, and abrupt counterparty cutoffs increase for trade, finance, and logistics.

Tariff volatility as negotiation tool

The administration is using tariff threats—up to 100% on Canadian goods and shifting rates for key partners—as leverage in broader negotiations. This raises landed-cost uncertainty, complicates pricing and contracting, and incentivizes nearshoring, dual sourcing, and inventory buffers for import-dependent firms.

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.

Baht strength and monetary easing

The Bank of Thailand signals accommodative policy and more active FX management amid baht appreciation and election-linked volatility. A potential cut toward 1.00% and tighter controls on gold-linked flows affect exporters’ margins, import costs, hedging needs and repatriation planning.

Rail connectivity and cross-border links

Saudi Railways moved 30m tonnes freight in 2025 and 14m passengers, displacing ~2m truck trips and cutting 364k tonnes emissions. New rolling-stock deals and the approved Riyadh–Doha high-speed rail deepen regional connectivity for labour, tourism, and time-sensitive cargo.

Allied defence-industrial deepening (AUKUS)

AUKUS-related procurement and wider defence modernisation continue to reshape industrial partnerships, technology controls and security vetting. Suppliers in shipbuilding, cyber, advanced manufacturing and dual-use tech may see growth, but face stricter export controls, sovereignty requirements and compliance burdens.

Fiscal pressure and project sequencing

Lower oil prices and reduced Aramco distributions are tightening fiscal space, raising the likelihood of project delays, re-scoping and more PPP-style financing. International contractors and suppliers should plan for slower award cycles, tougher payment terms, and higher counterparty diligence.

Reopening travel, visa facilitation

Large rises in cross-border trips and wider visa-free/extended transit policies (including UK visa-free plans) improve commercial mobility and service trade. However, implementation details and reciprocity remain variable, requiring firms to plan for compliance, documentation, and policy reversals.

Gaza spillovers and border operations

Rafah crossing reopening for limited passenger flows underscores persistent Gaza-related security and humanitarian pressures. While not a primary goods corridor, heightened North Sinai sensitivities can affect permitting, workforce mobility, and reputational risk. Companies should strengthen security protocols and compliance screening.

Energy security and gas reservation

Federal plans to introduce an east-coast gas reservation from 2027—requiring LNG exporters to reserve 15–25% for domestic supply—could alter contract structures, price dynamics and feedstock certainty for manufacturers and data centres. Producers warn of arbitrage and margin impacts in winter peaks.

EU Customs Union Modernization

Turkey and the EU are moving to “pave the way” for modernizing the 1995 Customs Union, alongside better implementation and renewed EIB activity. An update could expand coverage and improve regulatory alignment, supporting nearshoring, automotive/appliances supply chains, and cross-border investment planning.

Currency management and capital controls

Beijing’s preference for financial stability sustains managed exchange-rate policy and episodic tightening on capital outflows. Firms face repatriation frictions, FX hedging costs, and potential constraints on intercompany funding, dividends, and cross-border M&A execution timing and approvals.

Macrostability via aid and reserves

Despite war shocks, NBU policy easing to 15% and a reserves build to a record ~$57.7bn (Feb 1, 2026) reflect heavy external financing flows. This supports import capacity and FX stability, but leaves businesses exposed to conditionality, rollover timing, and renewed energy-driven inflation.

Digital tax reporting expands to SMEs

HMRC’s Making Tax Digital for Income Tax begins April 2026 for self‑employed/landlords over £50k, moving to quarterly submissions via paid software; thresholds fall to £30k (2027) and £20k (2028). This increases compliance cost, process change and advisory demand.

Red Sea–Suez shipping volatility

Red Sea security disruptions continue to reroute vessels, weakening Suez Canal throughput and foreign-currency inflows. While recent data show partial recovery (FY2025/26 H1 revenues +18.5%), insurers, transit times, and freight rates remain unstable, affecting Egypt-linked logistics and pricing.

US tariff and NTB pressure

Washington is threatening to restore 25% tariffs unless Seoul delivers on a $350bn US investment pledge and eases non-tariff barriers (digital rules, agriculture, auto/pharma certification). Policy uncertainty raises pricing, compliance, and sourcing risks for exporters.

LNG export acceleration and energy leverage

Policy has shifted toward faster approvals and “regular order” for non‑FTA LNG export permits, supporting 15–20 year contracting with Europe and Asia. This boosts US energy geopolitics, but creates competitiveness and price-risk considerations for energy‑intensive manufacturers globally.

Fed easing cycle and dollar swings

Cooling inflation is strengthening expectations for mid‑year Federal Reserve rate cuts, influencing USD direction, funding costs, and risk appetite. International firms should reassess hedging, USD-denominated debt, and pricing strategy, as rate-driven FX and demand conditions can shift quickly.

High energy costs and circular debt

Electricity tariffs remain structurally high, with large capacity-payment burdens and a Rs3.23/unit debt surcharge for up to six years. Despite reform claims, elevated industrial power prices erode export competitiveness, raise production costs, and influence location decisions for energy-intensive manufacturing.

Stablecoins and payments disintermediation

Rapid stablecoin growth threatens to siphon deposits from banks (estimates up to $500bn by 2028 in developed markets) and disrupt fee income. For corporates, faster settlement may help, but deposit outflows can weaken regional lenders’ credit provision and liquidity buffers.

Gasversorgungssorgen treiben Wärmewende-Tempo

Sehr niedrige Gasspeicherstände (unter 30%) erhöhen Preis- und Versorgungsschwankungen für gasbasierte Wärme, insbesondere im Süden. Das beschleunigt Umstiegsentscheidungen zu Wärmepumpen und Fernwärme, verändert Beschaffungsstrategien und erhöht Hedging-, Vertrags- und Kreditrisiken entlang der Lieferkette.

Gas price and storage stress

Low German gas storage levels and higher winter price sensitivity increase heating-cost volatility. This strengthens the business case for electrification and efficiency retrofits, but also elevates default risk for households and SMEs, affecting credit underwriting, consumer financing, and project payback calculations.

Election, coalition, constitutional rewrite

February 2026 election and constitutional referendum (about 60% “yes”) reshape Thailand’s policy trajectory. Coalition bargaining and court oversight risks can delay budgets, permits, and reforms, affecting investor confidence, PPP timelines, and regulatory predictability for foreign operators.

Energy transition and critical minerals

India targets rare-earth corridors and a ₹7,280 crore permanent-magnets incentive, reflecting urgency after China export curbs. Renewable capacity reached ~254 GW (49.83% of installed) by Nov 2025, boosting investment in grids, storage, and clean-tech supply chains.

High rates, easing cycle

The Central Bank kept Selic at 15% and signaled potential cuts from March as inflation expectations ease, but fiscal uncertainty keeps real rates among the world’s highest. Credit costs, consumer demand, and project IRRs remain sensitive to policy communication and politics.