#1

Steel and Aluminum Tariffs

The Trump administration has imposed a 25% tariff on all steel and aluminum imports, effective March 12, 2025, in an effort to protect domestic metal producers. These tariffs have sparked immediate retaliation from key trading partners, Canada and the EU, escalating trade tensions and impacting a range of industries. The U.S. tariffs also extend to downstream metal products, including nuts, bolts, bulldozer blades, and soda cans, further increasing costs for American businesses reliant on these materials. In response, Canada has announced retaliatory tariffs totaling 29.8 billion Canadian dollars ($20.7 billion USD), targeting U.S. steel, aluminum, and other goods, such as computers and sports equipment. Meanwhile, the EU plans to impose counter-tariffs on up to 26 billion euros ($28 billion USD) worth of U.S. goods next month, focusing on products such as bourbon, motorcycles, and boats. These retaliatory measures are expected to have significant ripple effects across global trade, particularly for export-driven industries in the U.S.

For businesses, these escalating trade disputes present several key challenges. First, increased production costs will impact industries heavily reliant on imported metals, including automakers, construction firms, and beverage producers. Many of these businesses will be forced to pass higher costs onto consumers, leading to rising prices for finished goods. Second, supply chain disruptions will cause delays and force companies to seek alternative suppliers, increasing operational costs and complexity. U.S. exporters also face reduced competitiveness abroad due to retaliatory tariffs, particularly in the agriculture and manufacturing sectors, potentially leading to declining sales and market share in Canada and Europe. Beyond manufacturing, the tourism and retail sectors will also feel the strain. Rising anti-American sentiment over tariffs has led to a 20% decline in Canadian travel to the U.S., affecting hotels, restaurants, and retail businesses that rely on cross-border tourism. Additionally, financial markets have reacted negatively, with increased volatility in stock prices, currency fluctuations, and declining investor confidence, which could further disrupt business planning. Sign up here for the Strategic Memo to read more in-depth reporting on the economic impacts of Trump’s tariffs.

#2

Twitter Down

On March 10, 2025, social media platform X (formerly Twitter) suffered a major outage due to a large-scale distributed denial-of-service (DDoS) attack. While Elon Musk suggested the attack may have originated from Ukraine-based IP addresses, cybersecurity experts warned that attribution is difficult due to the use of compromised networks and proxies. A pro-Palestinian hacker group, Dark Storm Team, claimed responsibility, aligning with its pattern of targeting organizations perceived as politically aligned with Western or Israeli interests. The attack disrupted X's global services, causing financial losses and reputational damage, while also demonstrating the vulnerabilities of tech companies that become embedded in political narratives. In a separate incident, a masked suspect terrorized Tesla charging stations in North Charleston, South Carolina, spray-painting political messages referencing Ukraine and former President Trump before using Molotov cocktails to set the stations on fire. The attacker, who unintentionally set fire to himself while fleeing the scene, is now the focus of a federal investigation. This attack reflects a broader trend of corporations being physically targeted based on perceived political or ideological positions. Tesla, under Musk’s leadership, has been at the center of political controversies, making its infrastructure a symbolic target for individuals using acts of sabotage to express political grievances. Both incidents highlight the heightened security risks for businesses caught in political polarization. Companies that engage with contentious social or political issues—whether intentionally or not—risk becoming flashpoints for retaliation from activists, hacker groups, or lone actors.

#3

Ukraine-Russia Ceasefire

The latest developments in the Ukraine conflict highlight a shifting geopolitical landscape shaped by U.S. policy adjustments, Russian strategic maneuvering, and broader Western responses. Ukraine has agreed to a U.S.-brokered 30-day ceasefire, contingent on Russia’s acceptance, which has led to the restoration of U.S. military and intelligence support to Kyiv. This move signals Washington’s renewed commitment to Ukraine, despite earlier concerns that a Trump administration might scale back aid or push for a settlement favorable to Moscow. However, Russia’s reaction remains ambiguous, with Kremlin officials expressing skepticism and reluctance to engage in a ceasefire under terms perceived as favoring Ukraine. The ceasefire proposal and its geopolitical consequences are far-reaching. The long-term geopolitical implications of these developments extend beyond the immediate Ukraine conflict. China, Iran, and North Korea are closely monitoring how the U.S. and its allies handle Russia’s assertiveness. A softened Western response could embolden other authoritarian regimes to challenge international norms, while a decisive reaction could reinforce collective security arrangements like NATO and the AUKUS alliance. Additionally, countries in Eastern Europe, particularly Poland and the Baltic states, are likely to push for stronger NATO deterrence measures, fearing that a weakened Western stance on Ukraine could embolden Russian expansionist ambitions elsewhere. Meanwhile, tensions have escalated further with Russia’s “warning” to Australia regarding potential peacekeeping troop deployments in Ukraine. Moscow’s vehement opposition to foreign peacekeepers suggests that it views any Western military presence—whether combat or humanitarian—as a direct provocation. This rhetoric aligns with previous Russian red lines on NATO expansion and foreign intervention, emphasizing Moscow’s broader strategic goal of preventing further Western entrenchment in Eastern Europe.

#4

Philippines ICJ

The arrest of former Philippine President Rodrigo Duterte by the International Criminal Court (ICC) on charges of crimes against humanity marks a pivotal moment with profound geopolitical implications. Duterte, known for his aggressive anti-drug campaign during his presidency from 2016 to 2022, was detained upon arrival in Manila from Hong Kong and subsequently extradited to The Hague to face trial. This development is a pivotal moment for the ICC because it reinforces its role in global governance. The arrest sends a clear message to current and future leaders that policies resulting in widespread human rights abuses can lead to international prosecution, potentially deterring similar actions worldwide.

Domestically, the arrest has revived hopes for justice among families of the drug war victims, signaling a potential shift towards greater adherence to the rule of law in the Philippines. However, it also poses challenges for the current administration, which must balance international obligations with domestic political dynamics, especially considering Duterte's enduring support base. The arrest could not have happened without the support of the current government, which also shows the limitations of organizations like the ICC. The current president is Ferdinand Marcos, son of the former dictator, and his cooperation with the ICC was likely a political move. Such actions, though, can increase instability in developing countries if leaders believe they will be arrested after implementing unpopular policies.

#5

Meta AI Chip

Meta Platforms has initiated testing of its inaugural in-house artificial intelligence (AI) training chip, a move poised to significantly influence the U.S. technology sector. This dedicated accelerator is designed to handle AI-specific tasks, potentially enhancing power efficiency compared to traditional GPUs. By collaborating with Taiwan Semiconductor Manufacturing Company (TSMC) for production, Meta aims to reduce its dependence on external suppliers like Nvidia, thereby lowering infrastructure costs associated with its substantial AI investments. The introduction of Meta's custom AI chip also signifies a broader industry trend where major tech companies are developing proprietary hardware to optimize AI workloads. This strategy not only offers potential cost savings but also provides greater control over hardware-software integration, leading to improved performance and efficiency. Such developments could intensify competition among U.S. tech giants, spurring further innovation in AI hardware design. Moreover, Meta's move may impact the dynamics of the semiconductor industry. By producing its own AI chips, Meta could reduce its procurement from established chipmakers, potentially affecting their market shares and prompting them to innovate further to maintain competitiveness.

#6

U.S. Allies Reconsider Intelligence Sharing

President Trump's disruptive policy shifts toward Russia have raised significant concerns among U.S. allies, leading them to reconsider the extent of intelligence sharing with the United States. These allies include the Five Eyes, Israel, and Saudi Arabia. Trump's suspension of military aid and intelligence sharing with Ukraine, coupled with his apparent trust in Russian President Vladimir Putin, has alarmed European nations. This pivot has strained longstanding defense and intelligence relationships, prompting allies to question the reliability of the U.S. as a partner. The implications for international security are profound. Reduced intelligence sharing will hinder coordinated efforts to address global threats, such as terrorism and cyberattacks. Allied nations will likely seek to develop independent intelligence capabilities or form new alliances, potentially leading to fragmentation within existing security frameworks like NATO. This erosion of trust is highly likely embolden adversarial nations to exploit perceived divisions among Western allies, thereby destabilizing the current international order. Furthermore, Trump's actions signal a shift in U.S. foreign policy priorities, affecting global power dynamics. By distancing the U.S. from traditional allies and engaging more closely with Russia, the administration risks undermining the current global balance of power and destabilizing eastern Europe, Africa, and the Middle East.

#7

Supply Chain Disruptions

Amid escalating U.S.-China tensions, several shipping companies are discreetly relocating operations from Hong Kong and re-registering their vessels under different flags. This strategic shift is driven by concerns over potential commandeering by Chinese authorities or the imposition of U.S. sanctions in the event of a conflict between the two nations, particularly over Taiwan. There are several implications for businesses as they try to navigate (literally) around the U.S.-China competition. First, the U.S. Trade Representative's proposal to impose substantial port fees on Chinese-operated and Chinese-built vessels underscores the financial risks associated with geopolitical tensions. Companies operating vessels built in China or under Chinese flags will likely face increased operational costs, prompting a reevaluation of supply chains and cost structures. Second, recent acquisition of key ports in the Panama Canal by a U.S.-led consortium from a Hong Kong-based firm reflects a broader trend of businesses divesting assets to align with shifting geopolitical landscapes. This move aims to alleviate concerns over Chinese influence in critical infrastructure, indicating a strategic repositioning by companies to align with geopolitical shifts. Third, the reconfiguration of shipping operations and potential imposition of tariffs contribute to market volatility. The U.S. dollar's recent decline and fluctuations in global stock markets highlight the broader economic uncertainty stemming from trade tensions. Businesses across sectors will likely experience disruptions in supply chains, increased costs, and shifts in trade patterns as a result.

#8

UK Attempts to Develop AI

The UK Labour government has announced an ambitious AI Opportunities Action Plan to integrate artificial intelligence across the public sector, aiming to reduce bureaucracy, automate administrative work, and save billions in staffing costs. The plan draws heavily from reports by the Tony Blair Institute (TBI), which advocates replacing civil servants with AI-driven automation, particularly large language models (LLMs) like ChatGPT. The government projects over $200 billion in savings over five years by cutting 1 million public sector jobs. The initiative promotes machine learning successes in healthcare—such as AI-assisted radiology scans—as evidence of AI's broader utility. However, the core strategy relies on LLM-based chatbots, which have significant reliability issues. LLMs generate text statistically rather than understanding information, making them prone to hallucinations, errors, and misinterpretations. Real-world tests, such as a consultation summary bot in Australia, have demonstrated LLMs' inability to consistently produce accurate reports, raising concerns about their suitability for critical government functions. The initiative extends beyond administrative automation into areas like education and infrastructure, where AI chatbots will handle curriculum planning and grading. AI-powered pothole detection has also been proposed, despite the real issue being chronic underfunding of local road maintenance. Meanwhile, AI "growth zones" will fast-track data center construction and deregulate regulatory bodies, ensuring tech firms face fewer legal barriers in deploying AI. Critics argue that LLM technology is unreliable, economically unsustainable, and propped up by speculative venture capital. OpenAI, for example, loses $2.35 for every $1 in revenue, suggesting that the AI industry depends on external funding rather than organic market demand. The UK’s AI plan risks fueling an AI bubble with taxpayer money that would harm the already delicate economy of the UK. However, this could be the solution to the UK’s long-term “productivity problem.”