Mission Grey Daily Brief - July 17, 2024
Summary of the Global Situation for Businesses and Investors
The world is witnessing a confluence of critical events, from the attempted assassination of former US President Trump to the ongoing war in Ukraine and the political turmoil in Bangladesh. In Cyprus, tensions are escalating between Turkish and Greek Cypriots, while North Korea faces another blow as a senior diplomat defects to South Korea.
US-China Relations
The attempted assassination of former US President Trump has sparked discussions in China about the weaknesses of the US political system. This incident, along with the US-China trade tensions and the Taiwan conflict, has experts worried about a potential US-China cold war turning hot. The US has maintained and strengthened tariffs on Chinese imports, and both political parties are pushing to get tougher on China and its companies. The US must balance its approach to China, leveraging its technological advantage while also utilizing soft power to attract international talent and maintain its influence.
Ukraine-Russia War
The war in Ukraine continues to rage on, with both sides clashing over foreign policy and Russia's invasion. Ukraine is facing a war of attrition, relying heavily on international aid that may decrease over time. To sustain its economy, Ukraine is raising taxes and switching to internal resources. The recovery and reconstruction of Ukraine will be challenging due to population decline and refugee displacement. Sanctions on Russia's energy sector are necessary to stop its war efforts, and a total energy embargo could be effective.
Political Turmoil in Bangladesh
Bangladesh is facing violent political turmoil over the government's job quota system, resulting in the deaths of at least five people and injuries to over a hundred. The protests have disrupted traffic and halted railways and highways across the country. The situation highlights the need for businesses to monitor political risks and assess the stability of the operating environment.
Cyprus Conflict
Tensions are escalating in Cyprus as Turkish Cypriots and Greek Cypriots engage in a series of escalations along the buffer zone, including the deployment of large-caliber weapons and the installation of high-tech cameras. This situation could have broader implications for the region, and the international community must act to prevent open hostilities from breaking out.
North Korean Diplomat Defection
A senior North Korean diplomat based in Cuba, Ri Il Kyu, defected to South Korea with his family in November 2023. This is a significant blow to North Korean leader Kim Jong Un as Ri played a crucial role in representing Pyongyang's interests in Havana and blocking Cuba from opening diplomatic ties with South Korea. The defection underscores the challenges faced by the Kim regime in maintaining control and the potential for further defections.
Recommendations for Businesses and Investors
- US-China Relations: Businesses with operations or supply chains in the US and China should closely monitor the evolving relationship between the two countries and prepare for potential disruptions due to escalating tensions.
- Ukraine-Russia War: Companies with investments or operations in Ukraine should be aware of the ongoing war's impact on the country's economy and consider the potential benefits of relocating to Poland or the Czech Republic, which have experienced economic growth due to their EU membership prospects.
- Political Turmoil in Bangladesh: Businesses operating in Bangladesh should assess the impact of the political turmoil on their operations and consider the potential risks of civil unrest and supply chain disruptions.
- Cyprus Conflict: Companies with interests in Cyprus should monitor the situation and evaluate the potential impact on their operations. While the conflict is currently localized, there is a risk of escalation that could affect the wider region.
- North Korean Diplomat Defection: The defection highlights the instability within the North Korean regime and the potential for further elite defections. Businesses should consider the implications of a potential shift in North Korea's political landscape and the impact on their operations or investments in the region.
Further Reading:
A senior N. Korean diplomat defected to S. Korea from Cuba, Chosun Ilbo says - 朝日新聞デジタル
As the US reels from Trump shooting, China sees weakness - Business Insider
At least 5 killed, more than 100 hurt in Bangladesh job quota protests - McDuffie Progress
Canada pleads for political calming in wake of Trump shooting - Maple Ridge News
Canada reflects on its history of political violence in wake of attack on Trump - CBC.ca
Economist Says Total Energy Embargo Will Make Russia Stop Its War on Ukraine - Kyiv Post
European Parliament re-elects Roberta Metsola of Malta to lead 720 member EU body - UPI News