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Mission Grey Daily Brief - June 26, 2024

Summary of the Global Situation for Businesses and Investors

The global situation remains fraught with geopolitical tensions and economic challenges. In Kenya, anti-tax protests have escalated, resulting in clashes with police and fatalities. The country is witnessing a generational shift in its political landscape as youths take to the streets, leveraging digital tools to organize and spread their message. In South Korea, a deadly battery plant fire has brought attention to the dangers faced by migrant workers, who comprise a significant portion of the workforce. Indonesia is facing economic pressures with a widening budget deficit, while also dealing with a cyberattack and the return of pilgrims from Hajj. Afghanistan continues to grapple with a severe women's rights crisis, and Taiwan is facing scrutiny over human trafficking and forced labor in its fishing industry.

Kenya: Anti-Tax Protests and Political Transformation

Kenya is witnessing a resurgence of protests, with demonstrators expressing anger towards government corruption, arrogance, and tax proposals. These protests have escalated into deadly clashes with police, resulting in fatalities. This wave of demonstrations represents a new phase in the country's slow-motion revolution, driven by a younger generation that is increasingly utilizing digital tools such as social media to organize and spread their message. This shift in political engagement has the potential to reshape the country's political landscape and challenge traditional democratic rituals. The government's response to these protests will be crucial in determining the trajectory of this movement and its impact on the country's stability.

South Korea: Deadly Fire Exposes Migrant Worker Risks

A deadly fire at a battery plant in South Korea has killed 23 workers, with most of the victims being foreign nationals, particularly Chinese. This incident highlights the disproportionate risks faced by migrant workers in South Korea, who are three times more likely to die in industrial accidents than domestic workers. The country relies heavily on foreign labor to address labor shortages, particularly in sectors like small factories, shipyards, and farms. However, migrant workers often take on dangerous jobs that locals avoid, working under unsafe conditions. The South Korean government's response to this incident and its efforts to enhance worker protections will be critical in ensuring the safety and rights of migrant workers in the country.

Indonesia: Budget Deficit, Cyberattack, and Hajj Management

Indonesia is facing economic challenges, with a widening budget deficit driven by increased social spending and falling commodity prices. The World Bank forecasts the deficit to reach 2.5% of GDP this year and remain at that level in 2025. While revenue-side reforms could help keep the deficit under the mandated 3% ceiling, global economic uncertainties pose risks to the country's external balance and fiscal position. Additionally, Indonesia is dealing with a cyberattack that compromised its data center, and the country is also navigating the return of pilgrims from Hajj, praising digital solutions that facilitated their journey.

Afghanistan: Women's Rights Crisis and Taiwan: Human Trafficking Concerns

Afghanistan continues to face a severe women's rights crisis, with the UN stating that the situation is the most serious in the world and is worsening. This crisis demands urgent attention and action from the international community to protect the rights and safety of women in the country. In a separate development, Taiwan has been criticized by Greenpeace and other organizations for its handling of human trafficking and forced labor in its distant water fishing industry. Despite evidence of these abuses, the US has awarded Taiwan a Tier 1 ranking in the Trafficking in Persons Report for the fifteenth consecutive year. This has prompted calls for the US to downgrade Taiwan's ranking to reflect the severity of the issue and hold the country accountable for necessary reforms.

Recommendations for Businesses and Investors

  • Kenya: Businesses and investors with operations or interests in Kenya should closely monitor the evolving political situation and assess the potential impact on their activities. The country's political and social landscape is undergoing a generational shift, and understanding the motivations and goals of this new generation will be crucial for long-term strategic planning.
  • South Korea: The South Korean government's response to the battery plant fire and its commitment to enhancing worker protections, particularly for migrant workers, will be crucial to watch. Businesses and investors should evaluate their supply chains and operations in the country to ensure compliance with labor standards and worker safety regulations.
  • Indonesia: The economic challenges and digital security situation in Indonesia warrant attention from businesses and investors. While the country's <co: 13,33,53>economic growth is projected to remain steady</co: 13,33,53

Further Reading:

Afghanistan has the most serious women’s rights crisis in the world, the UN says. And it's getting worse - Toronto Star

Anti-tax protesters enter Kenya's parliament as clashes with police intensify, resulting in deaths - The Associated Press

Belarus's Tsikhanouskaya Says RFE/RL's Losik Incommunicado For 16 Months In Prison - Radio Free Europe / Radio Liberty

Beyond the arguments of geopolitics- Taiwan is personal for Xi and will remain a red line for China - The Financial Express

Challenges plague Botswana's media ahead of 2024 polls - Mmegi Online

Deadly Battery Plant Fire Highlights Risks for South Korea's Migrant Workers - U.S. News & World Report

Decades After War, North Korea Still Builds Borders, Draws Warning Shots - U.S. News & World Report

Finance ministers of South Korea and Japan discuss weakening of their national currencies - AzerNews.Az

GT Voice: Complementarity keeps driving China-Vietnam economic ties - Global Times

Greenpeace USA Condemns Biden Administration's Top Tier Ranking of Taiwan in latest Trafficking in Persons Report - greenpeace.org

In Kenya, tomorrow is here - Al Jazeera English

Indonesia Can Keep Budget Deficit Under 3% Ceiling, World Bank Says - U.S News & World Report Money

Indonesia Energy Corporation commences seismic exploration at Kruh Block - Offshore Technology

Indonesia lauds digital solutions in Hajj management as pilgrims return home - Arab News

Indonesia says a cyberattack has compromised its data center but it won't pay the $8 million ransom - Imperial Valley Press

Iran's Reformist, hard-liner candidates clash over foreign policy in last debate - Al-Monitor

Italy: Decline in media freedom demands EU action - ARTICLE 19 - ARTICLE 19

Themes around the World:

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US Tariffs and Trade Diversification

US tariffs of up to 50% on Brazilian goods in 2025 led to a 6.6% drop in exports to the US, but Brazil’s record exports of US$348.7 billion were sustained by aggressive market diversification, especially in agribusiness and new trade partnerships across Asia and Latin America.

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Environmental Regulations and Sustainability

Stringent environmental policies in France drive corporate sustainability initiatives and impact manufacturing costs. Compliance requirements influence investment decisions and supply chain configurations, aligning business practices with global ESG standards.

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Tourism Sector Recovery and Rebranding

Thailand targets a record 3 trillion baht in tourism revenue for 2026, leveraging global icons and digital campaigns to attract high-spending visitors. However, safety concerns, border tensions, and slow recovery in some regions continue to impact tourism flows and sector stability.

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Reliance on Remittances Over Exports

Pakistan’s economy is increasingly sustained by remittances and debt rather than exports. The export-to-GDP ratio dropped to 10.4% in 2024, widening vulnerabilities and highlighting the urgent need for export-led reforms, infrastructure upgrades, and improved trade agreements.

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Financial Sector Stability and Regulation

France's robust financial sector, underpinned by regulatory reforms, supports international banking and investment activities. Stability in this sector is crucial for capital flows and risk management for multinational enterprises operating in Europe.

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Economic Volatility and Inflationary Pressures

Pakistan's economy experiences significant volatility with high inflation rates and currency depreciation. These economic conditions erode purchasing power, increase input costs, and complicate financial forecasting for foreign investors and trading partners.

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Regional Security Alliances and Strategic Positioning

Japan’s explicit linkage of its security to Taiwan and US strategic documents underscore Taiwan’s role in Indo-Pacific stability. Heightened military posturing and alliance-building increase both deterrence and the risk of escalation, affecting long-term business planning and risk assessment.

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Geopolitical Tensions and Regional Conflict

Recent military clashes with Israel and US strikes on Iranian infrastructure have heightened regional instability. These tensions threaten energy exports, insurance costs, and the safety of international operations in and around Iran.

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Labor Market Dynamics

Saudi labor reforms and Saudization policies influence workforce availability and costs. International companies must adapt to local employment regulations, impacting operational efficiency and human resource strategies.

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Infrastructure Investment and Development

Significant government initiatives to upgrade transport, digital, and energy infrastructure aim to boost economic resilience and attract foreign direct investment. Improved infrastructure supports supply chain efficiency and regional connectivity, enhancing the UK’s appeal as a strategic business hub despite broader geopolitical uncertainties.

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Saudi-UAE Rivalry Disrupts Supply Chains

The intensifying Saudi-UAE competition in Yemen, especially over control of strategic ports and oil-rich regions, risks fragmenting regional alliances and disrupting Red Sea and Gulf supply chains. This rivalry could alter trade flows and increase operational risks for international businesses.

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Youth-Led Political Mobilisation

Generation Z activism and opposition rallies are reshaping the political landscape, challenging established power structures and demanding reforms. This trend increases volatility and may influence policy direction, regulatory enforcement, and the overall business environment.

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Sanctions and Compliance Pressures

The EU and US are preparing new rounds of sanctions against Russia and entities linked to the conflict. Businesses operating in Ukraine or Russia must navigate evolving compliance requirements, with heightened exposure to legal and reputational risks.

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Escalating Western Sanctions Pressure

Intensified US and EU sanctions, including new 500% tariffs, are sharply restricting Russia’s energy exports, financial flows, and trade. These measures are undermining Russia’s budget, squeezing oil revenues, and creating significant compliance risks for international businesses.

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Shifting Alliances and Defense Pacts

Turkey’s potential entry into a Saudi Arabia-Pakistan mutual defense pact and its balancing act between NATO, Russia, and regional actors reflect a fluid security environment. These shifts may affect foreign investment, technology partnerships, and supply chain security, especially in sensitive sectors.

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Critical Minerals and Energy Exports

Australia's abundant critical minerals and energy resources position it as a key supplier in global markets. Growing demand for lithium, rare earths, and natural gas supports export growth, attracting foreign investment but also exposing the sector to geopolitical risks and regulatory scrutiny impacting project timelines and profitability.

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Energy Transition and Policy Uncertainty

Despite federal efforts to revive fossil fuels, market forces and state policies have driven record renewable energy growth. However, abrupt regulatory changes, project cancellations, and legal disputes have created a volatile investment climate, especially in wind, solar, and EV supply chains.

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Environmental Standards and Export Access

Stricter environmental and sustainability requirements in global markets, such as the US ban on Vietnamese seafood, present both risks and opportunities for Thai exporters. Compliance with international standards is increasingly vital for market access and long-term competitiveness.

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Agricultural Protests Disrupt Logistics

Widespread farmer mobilizations, including blockades in Paris and Lyon, have disrupted transport and supply chains. These protests, focused on trade policy and regulatory burdens, pose risks to business continuity and market access for international firms operating in France.

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Regulatory Reforms and Investment Climate

Egypt accelerated regulatory reforms in 2025, including tax law updates, IP system overhaul, and personal data protection laws. These changes aim to attract foreign investment, improve compliance, and foster innovation, but implementation and enforcement remain business concerns.

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Infrastructure Deficiencies

Inadequate transport and logistics infrastructure, including port congestion and deteriorating road networks, hamper efficient trade flows. These bottlenecks increase lead times and logistics costs, challenging South Africa's role as a regional trade hub and affecting supply chain resilience.

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Sustainable Energy and Rural Electrification

Indonesia targets nationwide electrification by 2030, with significant progress in rural areas. The Desa Listrik program and new installations promote social equity and unlock economic opportunities, supporting investment in energy, technology, and rural development.

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Environmental Policies and Sustainability Initiatives

Israel's commitment to sustainability and green technologies influences business practices and investment decisions. Environmental regulations and incentives promote innovation in clean energy and sustainable agriculture, aligning with global ESG trends.

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Technological Decoupling

Restrictions on technology transfer and collaboration limit Russia's access to advanced technologies, impacting innovation and industrial capabilities. For foreign investors, this decoupling challenges joint ventures and technology-dependent projects, requiring reassessment of long-term investment viability.

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Political Stability and Governance

Domestic political dynamics, including government policies and election cycles, impact investor confidence. Political stability is crucial for maintaining a predictable business environment; instability can lead to capital flight and reduced foreign investment.

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Labor Market Dynamics

Tight labor markets and evolving workforce policies in the US influence operational costs and productivity. These factors affect multinational companies’ decisions on manufacturing locations and labor-intensive operations.

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Labor Market Dynamics

Indonesia's large, young workforce offers a competitive labor pool, but skill mismatches and labor regulations can constrain productivity. Labor unrest and wage inflation in certain sectors may also affect operational costs and investment attractiveness.

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Revised Foreign Trade Law

China’s updated foreign trade law strengthens its ability to retaliate against trade partners, restricts strategic mineral exports, and expands digital and green trade frameworks. These legal changes increase regulatory uncertainty for foreign firms and complicate international dispute resolution and market access.

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Societal Strains: Water, Energy, and Labor

Chronic water shortages, energy mismanagement, and rising unemployment compound Iran’s economic crisis. These systemic issues undermine productivity, increase social risk, and pose long-term challenges for sustainable business operations.

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Geopolitical Tensions and Regional Stability

Tensions in the Eastern Mediterranean and North Africa, including disputes over maritime boundaries and security concerns, affect trade routes and investor risk perceptions. Regional instability can disrupt supply chains and deter foreign direct investment.

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Supply Chain Diversification Gains

Southeast Asia, including Thailand, is capturing sourcing share as global supply chains shift away from China due to tariffs and trade tensions. Thailand’s imports to the U.S. rose 28% in 2025, positioning the country as a key alternative for international supply chain strategies.

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Financial Sector Resilience and Volatility

UK banking and financial stocks have rebounded strongly, buoyed by higher interest rates and global demand. However, sector volatility persists, especially in consumer-facing and media stocks, requiring careful risk management for international investors.

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Trade Relations and Agreements

Thailand's participation in regional trade agreements like RCEP and ASEAN Economic Community shapes its trade dynamics. These agreements facilitate market access, reduce tariffs, and attract foreign direct investment, bolstering Thailand's position in global trade networks.

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Aerospace Industry: Growth and Supply Chain Risks

The aerospace sector remains France’s top trade surplus contributor, with €77.7 billion revenue in 2024. However, industry leaders warn that excessive taxation and global supply chain dependencies, especially for critical materials, threaten competitiveness and future investment.

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Record Mexico-US Trade Surplus

Mexico’s exports to the US reached a record $48.5 billion in October 2025, with a 6.7% annual increase and a trade surplus of $18.9 billion. This underscores Mexico’s strategic role in US supply chains, but exposes it to US tariff and regulatory risks amid tense bilateral relations.

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Labor Market Dynamics and Skill Shortages

Pakistan's labor market is characterized by a large, young workforce but suffers from skill mismatches and low productivity. These factors affect manufacturing quality and innovation capacity, influencing foreign investors' decisions regarding local operations and outsourcing.