Middle East/North Africa
- Syria’s government reached a deal with the Kurdish-led Syrian Democratic Forces (SDF) to integrate the group into the national army, recognizing Kurdish rights and placing the north-east region under government control for the first time since 2012. The agreement, spearheaded by transitional president Ahmed al-Sharaa, follows the ousting of Bashar al-Assad in December and aims to end near-daily clashes between Turkish-backed rebel groups and the SDF. Meanwhile, fighting between Syrian security forces and Assad loyalists on the coast resulted in over 1,000 deaths, including 745 civilians. The situation remains volatile, as Israel bombed military sites in Daraa following threats of intervention to protect Syria’s Druze population, who have resisted external involvement in their affairs.
- On March 18th, Israel launched several aerial attacks across the Gaza Strip, killing over 400 and breaking the temporary ceasefire with Hamas, with Prime Minister Benjamin Netanyahu saying he ordered the strikes after Hamas’ “repeated refusal” to release remaining hostages. This month, Israel and the U.S. rejected a $53 billion Arab plan for Gaza’s post-war reconstruction, which proposed a transitional governance committee and international peacekeepers, favoring instead former President Donald Trump’s controversial proposal to resettle Gazans abroad. The war, trigged by Hamas’ October 7th attacks, has since led to over 48,400 Palestinian deaths and widespread destruction, with nearly 70% of Gaza’s infrastructure damaged. Amid fears of ceasefire collapse, Israel continues to restrict aid entry to pressure Hamas into further concessions, while also conducting operations in Lebanon against Hezbollah.
- Pakistani and Afghan security forces clashed at the Torkham border crossing, resulting in the death of one Afghan security officer and injuries to two others, with Pakistani personnel also wounded. The conflict erupted amid Pakistan’s closure of the crossing last month over Afghanistan’s construction of a new border post, stranding 5,000 trucks and disrupting vital food imports during Ramadan. Afghan Interior Ministry spokesman Abdul Mateen Qani accused Pakistan of initiating the violence, while Pakistani officials claimed the Taliban fired first, escalating tensions already strained by Pakistani airstrikes in Afghanistan last December. The border closure has led to significant economic losses, with Pakistani businesses reporting at least $15 million in damages and Afghan traders losing $500,000 daily, impacting bilateral trade worth over $1.6 billion in 2024.
- Anwar Gargash, the UAE’s senior diplomatic adviser, visited Tehran to deliver a letter from U.S. President Donald Trump regarding potential nuclear negotiations with Iran, meeting with Iranian Foreign Minister Abbas Araghchi. Trump’s outreach followed his March 7 comments about negotiating a new nuclear deal after withdrawing from the Joint Comprehensive Plan of Action (JCPOA) in 2018, but Iranian Supreme Leader Ayatollah Ali Khamenei rejected the proposal, criticizing U.S. pressure tactics. The UAE has positioned itself as a mediator between Washington and Tehran, a role previously played by Oman in U.S.-Iran diplomacy. As part of its “maximum pressure” strategy, the U.S. Treasury, led by Secretary Scott Bessent, aims to cut Iran’s oil exports to below 10% of current levels, maintaining economic pressure on the Islamic Republic.
- Market Implications: MENA markets will be shaped by Saudi Arabia’s sovereign wealth fund, which has increased its bond issuance to cover the country’s fiscal deficits, with public debt expected to reach over $350 billion by the end of 2025. Syria’s reintegration agreement with the SDF may stabilize northeastern Syria, creating investment opportunities despite lingering violence. In Gaza, the U.S. and Israel’s rejection of a $53 billion Arab-backed reconstruction plan prolongs humanitarian and economic crises, deterring investor interest. Additionally, escalating border clashes between Afghanistan and Pakistan disrupt cross-border trade, increase security costs, and diminish economic confidence in South and Central Asia.
Latin America & the Caribbean
- In response to U.S. President Donald Trump’s threats to impose 25% tariffs on Mexican imports, Mexican President Claudia Sheinbaum secured a temporary reprieve until early April, after deploying 10,000 National Guard troops to curb drug trafficking and illegal immigration. In March, tens of thousands of Mexicans rallied in Mexico City to celebrate the tariff delay, reinforcing Sheinbaum’s domestic support, which has surged to over 60% approval just five months into her presidency. Despite these measures, uncertainty persists as Trump maintains the possibility of enforcing tariffs, including those on steel and aluminum. In addition to security cooperation, Mexico has imposed tariffs on Chinese imports and extradited cartel leaders to the U.S. to align with Trump’s priorities, though economic forecasts warn of potential GDP contraction exceeding 1% if tariffs are implemented.
- A Venezuelan warship entered Guyana’s exclusive economic zone (EEZ), approached ExxonMobil’s Liza Destiny oil facility, and demanded information from its crew, escalating tensions over the long-standing Essequibo territorial dispute. This incursion follows Venezuela’s December 2023 referendum seeking to incorporate the Essequibo region, military buildups in early 2024, and an April 2024 law formally establishing “Guayana Esequiba” despite Guyana’s sovereignty claims. Venezuela’s actions appear driven by Nicolás Maduro’s efforts to consolidate domestic political support ahead of elections and challenge U.S. geopolitical influence following Washington’s withdrawal of a license which had allowed Chevron to operate in Venezuela. The international response has been mixed, with Guyana seeking assistance from the International Court of Justice (ICJ), and regional and global actors weighing their involvement to prevent further destabilization.
- President Donald Trump announced the termination of certain oil-related concessions granted to Chevron Corp. by the Biden Administration, which had authorized oil trade with Venezuela as part of broader concessions aimed at promoting electoral reforms. The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued Venezuela General License 41A, amending the prior General License 41, allowing for a wind-down period for previously authorized transactions until April. General License 41A continues to prohibit many activities previously authorized under General License 41, affecting companies and financial institutions involved in the Venezuelan energy sector. This decision signals a tightening of U.S. sanctions on Venezuela, targeting the Venezuelan government and Petróleos de Venezuela S.A., and requires businesses to reevaluate compliance with U.S. regulations and pursue new licenses as needed.
- BlackRock, Inc. signed a memorandum of understanding with CK Hutchison Holdings Limited to acquire 90% of the Panama Ports Company, which operates the Balboa and Cristóbal ports in Panama. The deal, valued at $22.8 billion, involves BlackRock acquiring 80% of Hutchison’s ports network across 23 countries, including key ports in Mexico, the Bahamas, and Latin America. This agreement mitigates U.S. security concerns about China’s influence in the region, particularly regarding potential backdoor access through Chinese-made port cranes and infrastructure. However, broader concerns about Chinese involvement in Panama’s infrastructure, such as the fourth bridge over the canal and Panama’s security sector ties with China, remain unaddressed.
- Market Implications: The Latin American markets face multifaceted challenges shaped by recent developments. Mexico’s response to U.S. tariffs creates significant economic uncertainty, disrupting supply chains, particularly in the automotive and electronics sectors. Tensions between Venezuela and Guyana over the resource-rich Essequibo region threaten regional stability and foreign investments. The U.S. revocation of Chevron’s license in Venezuela further strains its oil sector, prompting potential new partnerships while impacting global oil markets. Meanwhile, the $22.8 billion sale of strategic port assets in Panama by BlackRock marks a strategic move to counter Chinese influence, sparking geopolitical tensions.
Asia (ex-China/India)
- Former Philippine President Rodrigo Duterte was arrested at Manila’s international airport on an International Criminal Court (ICC) warrant for crimes against humanity related to his brutal war on drugs, which rights groups estimate killed tens of thousands and was subsequently flown to The Hague to face charges. The arrest followed his return from Hong Kong, with Duterte and his allies, including Vice President Sara Duterte, denouncing the ICC action as “oppression and persecution,” while he unsuccessfully sought intervention from the Philippine Supreme Court, citing the lack of an extradition treaty. Despite the Philippines’ withdrawal from the ICC in 2019, the court asserts jurisdiction over killings before the exit and during Duterte’s tenure as Davao mayor, with investigations resuming in 2023 after Manila’s objections were rejected. Duterte, still a popular and influential figure domestically, remains unapologetic, defending his actions as necessary to combat crime, while local convictions related to the drug war have been minimal, with only nine police officers convicted.
- Indonesia and Vietnam agreed to elevate their bilateral relations to a comprehensive strategic partnership during a meeting in Jakarta between Indonesian President Prabowo Subianto and Vietnam’s Communist Party General Secretary To Lam, marking 70 years of diplomatic ties. The leaders committed to deepening cooperation in politics, economy, defense, security, education, and science, with specific plans for joint military exercises, defense industry development, and capacity building in engineering and the digital economy. Economic initiatives include Vietnam’s VinFast planning to establish a vehicle factory and a network of up to 100,000 charging stations in Indonesia, though details remain undisclosed. This diplomatic upgrade, making Indonesia the second Southeast Asian nation after Malaysia to achieve this status with Vietnam, aims to strengthen ties amid regional economic and geopolitical uncertainties, particularly with the anticipated challenges from U.S. President Donald Trump’s “America First” policy.
- Myanmar’s military leader, Senior General Min Aung Hlaing, announced that a general election will be held in December 2025 or January 2026, marking the first specific timeline for the long-delayed polls amidst ongoing turmoil since the 2021 coup that ousted Aung San Suu Kyi’s civilian government. The junta, facing widespread armed rebellion and having lost control over significant parts of the country, claims 53 political parties have registered, though critics denounce the election as a sham to perpetuate military rule through proxies, especially as many parties are banned. Min Aung Hlaing, speaking during a visit to Belarus, promised a “free and fair” election, but the junta’s census for voter lists covered only 145 of 330 townships, highlighting logistical challenges. The planned election risks escalating violence, further destabilizing Myanmar, where the conflict has already displaced over 3.5 million people and devastated the economy.
- The Kurdistan Workers’ Party (PKK) declared a ceasefire with Turkey, following a historic call by its jailed leader, Abdullah Ocalan, to disband the group and end its 40-year armed struggle, marking the first significant response to his appeal for peace and democratic solutions. The PKK, based in northern Iraq, agreed to implement Ocalan’s directive, halting armed actions unless attacked, but conditioned its planned dissolution congress on improved prison conditions for Ocalan, including his physical freedom and ability to lead the process. Turkish President Recep Tayyip Erdoğan warned of continued military operations against the PKK unless the ceasefire promises were fulfilled, while framing Ocalan’s appeal as a “historic opportunity” to expand democratic space, though his government has intensified crackdowns on opposition figures. The ceasefire announcement, welcomed by Iraq as a step toward regional stability, comes amid ongoing tensions due to the PKK’s presence in Iraq’s Kurdistan region and Turkey’s military operations there.
- Market Implications: The Asian markets, excluding China and India, are navigating significant geopolitical shifts. The Indonesian Stock Exchange temporarily halted trading on March 18th as the market fell more than 7%, caused by factors such as a credit downgrade and rumors about the country’s financial minister resigning. The arrest of former Philippine President Rodrigo Duterte introduces short-term political uncertainty, potentially affecting foreign investment and tourism, though compliance with international protocols may stabilize long-term impacts. Meanwhile, Myanmar’s election plans and closer ties with Russia could reshape its economic landscape, but internal conflicts and sanctions remain critical barriers to progress.
Sub-Saharan Africa
- South Sudan’s fragile peace agreement, established in 2018 to end a five-year civil war between President Salva Kiir and First Vice-President Riek Machar, is under threat following the arrest of two of Machar’s key allies—the oil minister, Puot Kang Chol, and deputy army chief, General Gabriel Duop Lam—amid escalating tensions and violent clashes in Upper Nile State. The government accuses Machar’s Sudan People’s Liberation Movement-in-Opposition (SPLM-IO) of collaborating with rebel groups, including the White Army, in attacks that overran a government garrison, while Machar’s residence in Juba was briefly surrounded by army forces, though he remained active in his office. The arrests, described as lacking legal justification, have been condemned by Machar’s camp as a violation of the peace deal, prompting calls for international intervention to prevent a return to full-scale violence, with the United Nations and regional bloc IGAD warning of worsening conflict and humanitarian crises. The unity government, already strained by unfulfilled peace agreement steps like elections and military unification, faces further instability following Kiir’s unilateral decisions to sack vice-presidents and a governor.
- Mozambique’s new President Daniel Chapo of the ruling Frelimo party, which has held power since 1975, appointed a cabinet of largely reshuffled long-term officials amid ongoing protests over alleged election fraud, with at least 308 deaths reported since demonstrations began following a disputed election in October. Opposition leader Venâncio Mondlane, who claims victory despite official results giving Chapo 65% of the vote, has threatened to paralyze the country through continuous protests, escalating tensions as over 13,000 Mozambicans flee to drought-stricken Malawi. Chapo, the first post-independence war president, faces challenges including a national debt nearing 94% of GDP, exacerbated by a $2.2 billion corruption scandal involving past Frelimo leaders, and economic losses of $658 million from post-election unrest and cyclones. Despite promises to address poverty, unemployment, and an insurgency in the north, the lack of reform in Chapo’s cabinet and ongoing economic woes, including uncertain IMF loan negotiations, fuel skepticism and potential for further instability.
- The United Nations’ World Food Programme (WFP) is closing its southern African bureau in Johannesburg, which has been coordinating responses to the region’s worst drought in four decades, due to an expected 40% reduction in donor funding, particularly from the U.S., which provided nearly half of the agency’s $9.7 billion budget last year. This closure, announced by WFP Global Executive Director Cindy McCain, comes as 26 million people across seven southern African countries face food shortages ahead of the May harvest, exacerbated by the El Niño weather phenomenon. The bureau, responsible for procuring and transporting significant food supplies locally, will see some of its functions transferred to the East African bureau in Nairobi, with a transition team overseeing the changes throughout the year. The decision, which shocked the 160 employees in Johannesburg, reflects broader funding challenges, with WFP bracing for annual contributions to drop to around $6 billion, the lowest since 2017, amid cuts in U.S. and European aid under policies like President Trump’s dismantling of foreign aid programs.
- The Associated Press reported that U.S. and Israeli officials have approached Sudan, Somalia, and Somaliland about resettling Gaza’s displaced Palestinians, following President Trump’s proposal in February 2025 to relocate Gazans due to the region’s uninhabitability. The plan, first suggested during Trump’s meeting with Israeli Prime Minister Netanyahu, involves relocating over 2 million Palestinians and U.S. involvement in rehabilitating Gaza. Sudan reportedly declined the offer, while Somalia and Somaliland expressed no knowledge of the discussions. The U.S. and Israel have led the talks since February, but the proposal has sparked significant backlash across the Arab world and Europe.
- Market Implications: Sub-Saharan Africa’s markets are grappling with significant challenges. Escalating tensions in South Sudan threaten its oil industry and deter foreign investment, while widespread protests in Mozambique following disputed elections disrupt business operations and raise political risk premiums. The closure of the World Food Programme’s Southern Africa office exacerbates food insecurity, potentially leading to social unrest and economic instability.
