Jean H Feildel

I help executives make informed decisions and deal with foreign governments in complex markets.
Founder of 476CE and Re/Gulf

[Jean H Feildel @jhfeildel]

If you have international exposure in your organization and want to understand how macroeconomics, political risks, and geopolitics may affect your activities, click the link below

https://t.co/7p76O8vmPQ

Cheers :)

[Jean H Feildel @jhfeildel]

I am launching an international risk mapping service and I am looking for 5 companies to beta test it.

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[Jean H Feildel @jhfeildel]

In case you missed it, I recently published a brief on ADQ’s $35 bn operation in Egypt in my newsletter RE|GULF.

Executives at Ardian, BNPP, FAB, TotalEnergies, and many others read it.

Want to join them and get the next brief?

Subscribe here

https://t.co/5KdvGqyooF

[Jean H Feildel @jhfeildel]

ADQ will invest $35bn in Egypt. That’s a lot.

In 2019, ADQ had already committed to invest $20 Bn in the North African economy with Egypt Sovereign Fund.

[Jean H Feildel @jhfeildel]

2024:

➡️ undisclosed amount for a 40.5% in luxury hotel group ICON (probably between $100 and 200 M)

Total ⇒ $3 bn

Investment commitment is hard to obtain

And harder to execute.

[Jean H Feildel @jhfeildel]

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Nevertheless, overall business conditions in the GCC countries remain largely conducive. Companies need to ensure their contingency plans are up-to-date and robust enough to handle an escalation of the conflict.

[Jean H Feildel @jhfeildel]

- Consequences for business in this scenario are hard to predict at this stage but include further disruption of maritime traffic, increasing O&G prices, flight restrictions, and increased border controls.

[Jean H Feildel @jhfeildel]

- The Houthis might also intensify pressure on other countries with ties to Israel.

Business Implications:

[Jean H Feildel @jhfeildel]

- No country in the region or outside is interested in a full-blown conflict across the Middle East. But the risk of incidents sparking extensive conflicts is significant, with potential flashpoints in Syria, Lebanon the Hormuz Strait, and Iraq.

[Jean H Feildel @jhfeildel]

Scenario 3. Full escalation
- A notable development is Tehran’s January 17th attack on Pakistan, which led to Pakistani retaliation. While not directly linked to the Israel-Gaza conflict, it amplifies regional instability and raises fears of broader escalation.

[Jean H Feildel @jhfeildel]

as rerouting away from the Red Sea (12% of global seaborne trade) adds about two weeks to Asia-Europe shipments.
- On the energy side, oil prices have recorded only a limited increase as global demand for energy remains constrained.

[Jean H Feildel @jhfeildel]

Business Implications:
- This situation is already impacting maritime activities, with daily traffic in the Suez Canal down by 40% from the 2023 average.
- Businesses should brace for broader disruptions in global maritime transport,

[Jean H Feildel @jhfeildel]

- The Houthis might suffer but earn some political capital at home and abroad. These could further complicate the resolution of the internal war

[Jean H Feildel @jhfeildel]

Scenario 2. Limited escalation: current situation

- Strikes from both sides continue.
- The US and UK want to pressure the Houthis but have no intention to engage in a full-scale war with the group.
- Neighboring countries also want to avoid another military conflict.

[Jean H Feildel @jhfeildel]

Red Sea: Three Scenarios to consider if you operate in the region.
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[Jean H Feildel @jhfeildel]

- Despite the extent of the US-UK airstrikes, the Houthis have persisted in attacking vessels in recent days. The group has already proven resilient throughout its war with Saudi Arabia and Aden.

[Jean H Feildel @jhfeildel]

- So far, however, Netanyahu remains firm on exerting maximum pressure, aiming for the complete dismantlement of Hamas, and has dismissed President Biden’s two-state peace proposal.
Even from Israel-friendly nations, international advocacy hasn’t yet influenced this stance.

[Jean H Feildel @jhfeildel]

Scenario 1. De-escalation
- Low probability for the moment.
- De-escalation would require at least one of the two following changes:
===Israel and Hamas establishing an extended ceasefire.
===US and UK strikes succeeding in degrading Houthis’ capabilities.

[Jean H Feildel @jhfeildel]

The conflict between Israel and Hamas has escalated into a broader regional turmoil following the US/UK military airstrikes against the Houthis in Yemen since January 12th.

Here are 3 possible scenarios that you should consider if you operate in the region.