Welcome to this week’s On Our Radar, our summary of developments from the past week that will have a significant impact on emerging markets, and, crucially, exactly why they are relevant to foreign investors.
These summaries are taken from excerpts of our Country Insights and Horizon Engage Interactive services – if you would like to receive our full reporting and analysis from our team of regional experts and former ambassadors on any of these developments, please click here for more information.
Country Insights Roundup
Argentina: 2025 for Milei: The Year of Consolidation
What happened: The Milei administration declared 2025 the “Year of the Reconstruction of the Argentine Nation.”
Why it matters: Beyond the formality, this year should consolidate Milei’s program economically and politically.
What happens next: We will be watching concrete signposts and objectives to measure his progress, including a key negotiation with the IMF in the first half of the year and the road to the midterm elections in October.
Azerbaijan: Azerbaijan and SOCAR Seek Influence in Syria Through Turkey
What happened: Azerbaijan and Syria normalized relations after a 12-year hiatus, reopening the embassy in Damascus and laying the groundwork for economic cooperation, with Turkey as a key partner.
Why it matters: In the longer term, this development creates opportunities for a strategic Azerbaijan-Turkey-Syria alliance, enabling post-conflict recovery in Syria and serving as a litmus test for Western investors to enter Syria by partnering with Azerbaijani and Turkish companies.
What happens next: Leveraging its partnership with Turkey, Azerbaijan plans to invest in Syria’s oil, gas and logistics sectors, supported by SOCAR’s expertise and regional connectivity projects like the Zangezur Corridor.
Brazil: Haddad Tries to Duck Global Headwinds in 2025
What happened: On 6 January, Finance Minister Fernando Haddad returned early from his planned vacation to reboot budget negotiations with congressional leaders.
Why it matters: Days before, Haddad celebrated the administration’s efforts to defend the economy against disruption and unemployment, assuring the markets of his commitment to fiscal stability.
What happens next: On the other hand, inflation is higher than the target, and the real continues to decline, placing greater pressure on Haddad to play hardball with leaders of the ruling coalition in Congress.
Greece: Athens Hopes French Involvement Will Cut GSI Gordian Knot
What happened: French infrastructure fund Meridiam has agreed to take a strategic stake in the GSI power linkup between Greece, Cyprus and Israel alongside project promoter IPTO.
Why it matters: Meridiam’s involvement — with the implied backing of the French government — promises to address concerns about geopolitical risk, which Cyprus has held up as an obstacle.
What happens next: More partners, including TAQA and DFC, could join the project, significantly increasing the odds that it will be implemented despite increased regional tensions.
India: Government to Fund Green Hydrogen Pilot Project in Kerala
What happened: On 6 January, the Ministry of New and Renewable Energy (MNRE) announced it would fund a green hydrogen pilot project for Kerala’s transport sector. The state’s Agency for New and Renewable Energy Research and Technology (ANERT) will cover part of the cost.
Why it matters: The government is trying to prevent the Kerala government, run by BJP rivals, from pursuing its own green hydrogen efforts. This is a politically important objective for Prime Minister Narendra Modi, who wants to dominate green hydrogen development and stop his political enemies — especially MK Stalin in Tamil Nadu — from pursuing green hydrogen projects and deals with foreign companies.
What happens next: Setting the political considerations aside, this deal is worth watching for investors. Green hydrogen development in the Indian transport sector is believed to entail particularly high costs. If this project can get off the ground and sustain itself financially, it could become a useful case study for overcoming cost challenges in a sector with attractive green hydrogen investment possibilities.
Iraq: Sudani’s Survival Strategy
What happened: Mohammed Shia al-Sudani is portraying himself as a Washington whisperer who can save Iran-backed militias from the Trump administration.
Why it matters: This is largely an illusion Sudani’s advisors have created that Sudani, to some extent, believes.
What happens next: Nevertheless, Iran is rallying Coordination Framework factions behind Sudani and trying to mute the judiciary.
Japan: 7th Strategic Energy Plan Draft Maintains Hydrogen, CCS Ambitions
What happened: Right before the calendar turned, METI published a draft of the 7th Strategic Energy Plan (SEP), a comprehensive roadmap for Japan’s energy system through 2040. The government is soliciting public comments on the SEP, its greenhouse gas emission reduction target and “GX 2040 Vision,” a green industrial policy package.
Why it matters: The government is maintaining its ambition to scale up hydrogen and ammonia production, transport, and use despite the stubbornly high cost of these fuels. On CCS, the SEP also clarifies that Japan will continue pushing to develop a value chain for captured CO2 to be stored domestically and overseas and create rules to make CCS profitable.
What happens next: The public comment period for the 7th SEP, the emissions reduction target and the GX 2040 Vision will close on 26 January. After a short revision period, the documents are expected to be approved by the Ishiba cabinet by the end of March.
Sao Tome and Principe: Vila Nova Sacks Trovoada Amid Political Feud
What happened: President Vila Nova sacked PM Trovoada and his government.
Why it matters: The political instability may impact STP’s relations with multilateral agencies and donors, which the government depends on to finance the state budget and develop basic infrastructure.
What happens next: The most likely scenario is that Trovoada and the ruling party will pick a new PM to serve until the next elections are due in 2026.
United States: Legislative Two-Step May Cause a Tax Pile-Up
What happened: President-elect Trump has called for “one big beautiful bill” that would contain both his immigration agenda and tax cut extensions to be passed by Congress.
Why it matters: With a tiny Republican majority, House Speaker Mike Johnson will struggle to pass anything, given the divisions within his own caucus. A single bill will likely lead to delays and infighting, increasing the odds that the two priorities get separated and one gets postponed even further.
What happens next: Immigration policy will likely pass in a standalone bill, leaving the tax cuts for later in the summer or fall — giving Democrats a chance to focus public attention on tax cuts for the wealthy.
Stakeholder Influence Tracker
Rising Influence: Delek Group owner Yitzhak Tshuva
Yitzhak Tshuva’s Delek Group will acquire a 37% stake in Isracard, Israel’s largest credit card company, for $358mn. Isracard’s board noted it narrowly preferred Delek’s offer over that of the Menorah Insurance Group.
Tshuva is already extremely well known, domestically and globally, for his key role in developing Israel’s natural gas sector and his considerable real estate interests. However, he has not been active in the financial sector since 2013, when legislation forced him to sell his controlling stake in Phoenix Insurance.
This deal marks Tshuva’s triumphant return to the sector. While it still needs regulatory approval, we expect the acquisition will go through.
Declining Influence: PUK leader Bafel Talabani
Turkey has extended its flight ban on Sulaymaniyah airport due to PUK leader Bafel Talabani’s refusal to remove Syrian and Turkish Kurdish leaders from the area.
Since its enactment in April 2023, the ban has been extended by four consecutive six-month periods. The new ban will expire in July 2025. However, it will be extended again unless Bafel makes concessions.
In our view, Bafel views the idea of making a public concession as humiliating and damaging to his political persona. However, this latest extension is punishment for his commitment to various pan-Kurdish forces, especially the Kurdish-led Syrian Democratic Forces.
It will freeze investment in Sulaymaniyah’s airport and air logistics businesses. The move will also angle many logistics contracts toward Erbil airport, benefiting Bafel’s Barzani rivals.
Find Out More
These summaries are taken from excerpts of our Country Insights and Horizon Engage Interactive products – if you would like to receive our full reporting and analysis from our team of regional experts and former ambassadors on any of these developments, please click here for more information.
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