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Mission Grey Daily Brief - July 09, 2024

Summary of the Global Situation for Businesses and Investors

The global situation remains highly dynamic, with several key developments impacting the geopolitical and economic landscape. Here is a summary of the most significant events from the past 24 hours:

  • Russia-Ukraine Conflict: Russia launched a massive missile barrage targeting multiple cities in Ukraine, including Kyiv, killing at least 36 people and injuring many more. A children's hospital in Kyiv was among the buildings hit, sparking widespread condemnation and prompting Ukraine to call for more air defense systems from its allies.
  • **France Elections: France held pivotal runoff elections that could result in a historic far-right victory or a hung parliament. The outcome will have implications for the country's policies on Ukraine, global diplomacy, and economic stability.
  • China-Russia Relations: China's President Xi Jinping called for world powers to facilitate direct negotiations between Russia and Ukraine, while also announcing joint military exercises with Belarus, a close ally of Russia.
  • Nepal Landslides: Heavy rainfall triggered landslides and flash floods in Nepal, resulting in at least 11 deaths, with eight people still missing. The Koshi River in southeastern Nepal is flowing above the danger level, raising concerns about potential flooding in the region. Rescue and recovery operations are ongoing, with authorities utilizing heavy equipment to clear debris and reopen blocked roads. The situation remains dynamic, with more rainfall expected in the coming days, which could exacerbate the impact of the floods and potentially lead to further casualties and damage.

Russia-Ukraine Conflict

The conflict between Russia and Ukraine continues to escalate, with Russia launching a large-scale missile attack on multiple Ukrainian cities, including the capital, Kyiv. This attack comes just a day before the NATO summit in Washington, where leaders are expected to discuss further support for Ukraine. The barrage included over 40 missiles, with hypersonic Kinzhal missiles among them, and targeted residential areas, infrastructure, and a <co: 0,10,11,12,14,15,20,30,31,32,34,35,40,50,51,52,54,55>children's hospital in Kyiv.</co: 0,10,11,12,14,15,20,30,31,32,34,35,40,50,51


Further Reading:

'Massive' barrage of Russian missiles target Ukraine, killing 21 and striking children's hospital - ABC News

'Ultimately, US will abandon the Philippines as a broken tool' - Global Times

A Kenyan court says 2022 shooting death of a Pakistani journalist by police in Nairobi was unlawful - WRAL News

A Ukrainian drone triggers warehouse explosions in Russia as a war of attrition grinds on - The Associated Press

At least 14 people killed in Ukraine after oil truck collides with minibus - The Independent

Children's hospital in Kyiv hit by missiles as Russia unleashes deadly barrage across Ukraine, killing at least 29 - Sky News

Children's hospital in Kyiv hit by missiles as Russia unleashes deadly barrage across Ukraine, killing at least 31 - Sky News

Children's hospital is blown up as Putin launches 'genocidal' missile strikes on multiple Ukraine cities on ev - Daily Mail

China hosts Hungary leader and announces joint exercises with Belarus - Airforce Technology - Airforce Technology

Dozens are killed as Russia bombards Ukraine. Among the buildings hit was a Kyiv children's hospital - ABC News

Dozens killed in Russian missile strike on children's hospital in Kyiv - FRANCE 24 English

France is voting in key elections that could see a historic far-right win or a hung parliament - The Associated Press

From Soccer Players to World Leaders: Reactions to France's Election Result - TIME

From Soccer Players to World Leaders: Reactions to France’s Election Result - TIME

Heavy rain triggers landslides in Nepal, 11 killed, 8 missing - The Straits Times

Themes around the World:

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Food import inspections disrupt logistics

A new food-safety regime (Decree 46) abruptly expanded inspection and certification requirements, stranding 700+ consignments (about 300,000 tonnes) and leaving 1,800+ containers stuck at Cat Lai port. Compliance uncertainty can delay inputs and raise inventory buffers.

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Immigration politics and labor supply

Foreign labor is now a core election issue. Japan plans to accept up to 1.23 million workers through FY2028 via revised visas while tightening residence management and enforcement. For employers, this changes hiring pipelines, compliance burdens, and wage/retention competition.

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Energy Crisis and Cost Relief Measures

Persistent energy shortages and high tariffs have hampered industrial output. Recent government relief measures, including tariff reductions and export refinance schemes, offer short-term support but underscore ongoing risks for manufacturers and supply chain reliability.

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Energy security and LNG contracting

Shrinking domestic gas output and delayed petroleum-law amendments increase reliance on LNG; gas supplies roughly 60% of power generation. PTT, Egat and Gulf are locking long-term LNG deals (15-year contracts, 0.8–1.0 mtpa). Electricity-price volatility and industrial costs remain key.

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Political Volatility and Diplomatic Strategy

President Sheinbaum’s approach to US relations emphasizes dialogue, sovereignty, and adaptability in the face of unpredictable US policy shifts. Ongoing communication with President Trump and Canadian leaders is crucial for maintaining trade stability and managing bilateral crises.

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Energy planning and power constraints

Vietnam is revising national energy planning to support 10%+ growth targets, projecting 120–130 million toe demand by 2030 and rapid renewables expansion. Businesses face execution risk in grids, LNG logistics, and permitting; power reliability remains a key site-selection factor.

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Regulação de dados e compliance LGPD

A Câmara aprovou MP que transforma a ANPD em agência reguladora, com carreira própria e maior capacidade de fiscalização. Isso tende a elevar enforcement, custos de conformidade e exigências contratuais, especialmente em cadeias com compartilhamento internacional de dados.

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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.

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China-exposure and strategic asset scrutiny

Beijing warned of potential retaliation over proposals to return Darwin Port from a Chinese lessee, highlighting renewed geopolitics around strategic infrastructure. Firms with China-linked ownership, customers or supply chains face higher political, reputational and contract risks, alongside tighter investment screening.

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Tightening outbound investment oversight

Beijing is strengthening export-control and technology-transfer enforcement, including reviews of foreign acquisitions involving China-developed tech. This raises deal approval risk, lengthens timelines, and increases due diligence burdens for cross-border M&A, JVs, and strategic minority stakes.

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Critical minerals bloc and rare-earth strategy

South Korea chairs the US-led FORGE initiative while also building a China hotline and joint committee to stabilize rare-earth imports. Policy includes easing public-sector overseas resource limits and funding mine access, reshaping sourcing, compliance, and procurement for EVs, chips, and defense.

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Regulatory Reforms and Business Transparency

Reforms led by the Securities and Exchange Commission of Pakistan have enhanced transparency, digitalized company registration, and aligned regulations with international standards. These measures have improved Pakistan’s global business rankings and investor confidence, supporting easier market entry and compliance.

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FX strength and monetary easing

A strong shekel, large reserves (over $220bn cited), and gradual rate cuts support financial stability but squeeze exporters’ margins and pricing. Importers benefit from currency strength, while hedging strategies become critical amid geopolitical headline-driven volatility.

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Semiconductor reshoring and tech geopolitics

Washington continues pressing for more Taiwan chip capacity and supply-chain relocation, while Taipei calls large-scale shifts “impossible.” TSMC’s massive US buildout and parallel overseas fabs heighten capex needs, export-control exposure, and dual-footprint operational complexity for suppliers and customers.

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FCA crypto regime tightening

FCA’s CP26/4 and Consumer Duty guidance pull crypto trading, custody and safeguarding into mainstream conduct standards, with an authorisation gateway due Sept 2026–Feb 2027 and full regime expected Oct 2027—reshaping UK market entry and product design.

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Technology Regulation and Data Security

US regulatory scrutiny over technology, data privacy, and AI is intensifying, with new rules affecting cross-border data flows and digital operations. Companies must adapt to evolving compliance landscapes, impacting investment decisions and digital supply chain strategies.

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ESG Standards and Regulatory Pressure

Environmental and social governance (ESG) standards are increasingly shaping investment and operational decisions, especially in mining. While Indonesia is adopting international frameworks, enforcement remains uneven, and companies face rising pressure from global buyers and lenders to improve compliance and transparency.

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EU Trade Policy Realignment and Protectionism

Germany is navigating shifting EU trade policies, including new deals with India and Mercosur, and stricter rules on public funding for non-European production. Rising protectionism and regulatory changes could alter market access, supply chain strategies, and compliance costs for multinationals.

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Upgraded EU-Vietnam Strategic Partnership

Vietnam and the EU have elevated ties to a comprehensive strategic partnership, deepening cooperation in trade, critical minerals, semiconductors, and technology. This move supports supply chain security, market access, and investment, especially as US tariffs reshape global trade dynamics.

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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.

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China exposure and strategic assets

Australia’s China-linked trade and investment exposure remains a top operational risk. Moves to potentially reclaim Darwin Port from a Chinese lessee, alongside AUKUS posture, raise retaliation risk. Western Australia’s iron ore exports to China near A$100bn underline concentration risk for supply and revenues.

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EV incentives and industrial policy resets

Les dispositifs de soutien aux véhicules électriques se reconfigurent: fin du leasing social après 50 000 véhicules, ajustements de bonus et débats fiscaux (malus masse EV lourd supprimé). Cela crée volatilité de la demande, impacts sur chaînes auto, batteries, réseau et occasion.

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Energy Dependency and Strategic Vulnerability

Germany’s reliance on imported energy, particularly US LNG after the Russian phase-out, exposes its economy to price shocks and political leverage. This dependency increases operational risks for manufacturers and raises costs, impacting competitiveness and long-term investment planning.

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India-UK Free Trade Agreement Impact

The recently signed UK-India trade deal grants Indian exporters duty-free access for 99% of products and is projected to boost UK-India trade by £25.5 billion annually. This agreement diversifies UK supply chains and reduces reliance on US and EU markets.

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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.

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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.

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Pressão socioambiental na Amazônia

Protestos indígenas bloquearam terminal da Cargill em Santarém contra concessões e dragagem na bacia do Tapajós, alegando falta de consulta. O tema eleva risco de paralisações, due diligence socioambiental e exigências de rastreabilidade em cadeias agrícolas.

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Labor Market and Federal Workforce Shifts

US job growth has slowed, with federal employment down 9% and manufacturing jobs declining. Policy uncertainty and tariffs have dampened hiring and investment, affecting consumer sentiment and business expansion plans, especially for international investors.

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Mortgage stress and domestic demand

CMHC flags rising mortgage stress in Toronto and Vancouver; over 1.5M households have renewed at higher rates and another ~1M face renewal soon. A consumer slowdown could weaken retail, construction, and SME credit demand, while increasing counterparty and portfolio risk.

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Geopolitical Shifts and Regional Integration

Turkey's strategic location is increasingly pivotal amid shifting global alliances, conflicts in Ukraine and the Middle East, and EU enlargement debates. Ankara's foreign policy emphasizes regional cooperation, energy corridors, and mediation roles, affecting supply chains and cross-border investments.

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US fiscal dysfunction and shutdown risk

Recurring shutdown threats and funding brinkmanship can disrupt federal procurement, permitting, and regulatory processing. While some enforcement bodies continue operating, uncertainty affects travel, customs coordination, infrastructure programs, and contractor cashflow—raising operational contingencies for firms dependent on federal interfaces.

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Tighter tech export controls

BIS continues tightening—and sometimes recalibrating—controls on advanced computing, AI chips, and semiconductor equipment tied to China. Firms must manage licensing, end-use checks, and diversion risk through third countries, raising costs and delaying shipments in sensitive tech ecosystems.

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Labor Market Reforms and Nationalization

Saudi Arabia’s labor market reforms, including workforce nationalization and global labor agreements, affect talent acquisition, compliance, and cost structures. Companies must adapt to evolving employment regulations and localization requirements to sustain operations.

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Nickel quota tightening and oversight

Indonesia’s nickel supply outlook is tightening amid plans to cut ore quotas and delays in RKAB approvals and MOMS verification, lifting benchmark prices. Separately, reporting lapses at major smelters highlight regulatory gaps. EV-battery supply chains face price, compliance, and continuity shocks.

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Energy security and transition buildout

Vietnam is revising national energy planning to support targeted 10%+ growth, projecting 120–130m toe final energy demand by 2030. Renewables are targeted at 25–30% of primary energy by 2030, alongside LNG import expansion and grid upgrades—critical for industrial reliability and costs.

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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.