Americas: Canada’s CP Rail halts operations amid strike, supply chain disruption looms

Sectors: all; rail transport; agriculture; manufacturing
Key Risks: business and economic risks; supply chain disruption; civil unrest 

In Canada, on 20 March Canadian Pacific Railway (CP) halted operations and locked out employees after talks with the Teamsters Canada Rail Conference (TCRC) union failed to reach an agreement amid a months-long labour dispute. The TCRC launched a nationwide strike shortly after the CP’s decision as both sides accused each other of the work stoppage, although the two were still reportedly in talks with federal mediators regarding a new labour deal. CP is the country’s second largest railroad operator and its network spans across southern Canada extending all the way to the US. The lockout and the strike risk further supply chain disruption, particularly in the agricultural and manufacturing sectors, given that the transportation of key commodities and goods heavily depends on the rail network. Further disruption and potential shortages will remain a risk at least over the coming days.

Asia Pacific: Shares of China’s Evergrande stopped trading on HKEX

Sectors: all; property
Key Risks: business & economic risks

In China, trading of Evergrande shares was halted on the Hong Kong Stock Exchange, fuelling speculations of an impending announcement regarding the beleaguered property giant’s restructuring. The suspension was the second in 2022 – trading was first halted on 3 January – and came ahead of a US$2bln coupon repayment due on 23 March. Evergrande’s liabilities – along with several defaults in other property firms – reflect wider cracks in the Chinese housing market. This came as the government postponed the property tax trial in major cities on 17 March. More easing measures are expected as Vice Premier Liu He called for financial stability and the need to reduce risks in the sector in a sign of heightened concerns within the top leadership about the property sector and the overall economic situation.

Eurasia: Ukraine rejects Russia’s ultimatum to surrender Mariupol 

Sectors: all
Key risks: war on land 

In Ukraine, Mariupol rejected Russia’s ultimatum to surrender. Russia’s military command gave the city until 05:00am local time on 21 March to respond to eight pages of demands – which Mariupol officials claimed would amount to a capitulation – or face ‘military tribunals’. Mariupol, which has been besieged and constantly shelled by Russian forces for weeks, faces a humanitarian catastrophe. The city has been reportedly cut off from water, electricity, heating, food and medicine supplies. Russian forces seek to capture the city to cut Ukrainian forces from the Sea of Azov and enable the formation of a land corridor between Crimea and the Donbas region. According to some assessments, Russian forces made limited advancements on the city. While local authorities stated that battles had been taking place ‘over every street,’ the extent of the advance remains uncertain. Heavy fighting is likely to continue.

Europe: EU mulls further Russia sanctions; US President Joe Biden to attend Brussels summits

Sectors: all; oil and gas; defence
Key Risks: sanctions; trade; business risks

On 21 March EU foreign ministers gathered in Brussels to discuss imposing new sanctions on Russia over the ongoing invasion of Ukraine. Ahead of the meeting EU Foreign Policy Chief Josep Borrell described Russia’s shelling of Mariupol as a ‘war crime’. The Baltic states have pushed for tougher sanctions on Moscow, including a ban on Russian oil imports which are the Kremlin’s greatest source of revenue. However, reticence among several EU member states renders any significant sanctions on Russian oil unlikely in the week ahead. Instead, EU leaders are likely to agree on the need to wean the bloc off of Russian energy as soon as possible. On 24 March US President Joe Biden is scheduled to attend EU, NATO and G7 summits in Brussels as Washington and Europe seek to present a united front against Russia.

MENA: Syria’s Assad makes first-ever visit to an Arab country since 2011

Sectors: all
Key Risks: sanctions

On 19 March Syrian President Bashar al-Assad travelled to the UAE and met with Crown Prince Muhamad bin Zayed Al Nahyan and Dubai’s ruler Sheikh Muhamad bin Rashid Al Maktoum. This was Assad’s first-ever visit to an Arab country since the start of the Syrian conflict in 2011. Assad was shunned from Arab forums and organisations after his brutal crackdown on protesters and has become politically isolated. US State Department officials stated that they were ‘troubled’ by the visit. Abu Dhabi is reportedly engaging Damascus to counter Tehran’s influence in the country. Assad’s visit to the UAE sent a clear message that some Arab states are eager to re-engage with him, much to the displeasure of the US. The visit will likely be a starting point for other Arab engagements with Assad, with the likes of Egypt and Algeria in favour of Syria’s return to the Arab League.

Sub-Saharan Africa: Triple attack by separatists highlights growing threat in Nigeria’s south-east

Sectors: all
Key Risks: political violence; civil unrest

In Nigeria, two police stations and the residence of a prominent community leader were attacked by suspected separatists in the country’s south-eastern Imo state on 19 and 20 March. Targets included Umuguma police station near Owerri, Oru police station in Owerri West and the residence of the head of the Igbo cultural union Ohanaez Ndigbo Worldwide. The attacks, which are suspected to have been carried out by separatists affiliated with the Indigenous People of Biafra (IPOB) or its paramilitary wing, the Eastern Security Network (ESN), highlight the enduring risk of separatist violence in Nigeria’s south-east – the intensity of which has steadily increased in recent years. Although the risk of reprisals by the security forces in the area is high, government efforts to tackle worsening separatism will likely prove incapable of stemming a further increase in violence over the coming year.