Global Public Affairs Newswire – 30 May 2025
Welcome to the latest instalment of FTI Consulting’s fortnightly Global Public Affairs Newswire.
This week, we bring you updates from FTI Public Affairs teams across the world’s major markets, including the United States, Germany, China, the United Kingdom, India, Ireland, France, South Africa, Colombia, Spain, and Brazil. This week’s update also brings readers market insights from FTI Public Affairs experts from around the world, explaining what these updates mean for your business.
Market updates
One big beautiful bill passes the US house
- All Eyes on Europe Following his initial foreign policy tour of the Middle East, the Trump Administration is shifting its focus to trade and security matters in Europe. U.S.-EU trade talks remain tense, with President Trump announcing a temporary suspension of his proposed 50% reciprocal tariffs—postponing implementation from June 1 to July 9. The President also took to social media to directly criticize Russian President Vladimir Putin for his unwillingness to engage in resolving the ongoing conflict.
- Veritas? The Trump Administration is using its executive authority to continue to cut significant sources of federal funding and deter international enrollment to several private and public colleges, including Harvard University which has lost nearly $3 billion in funding thus far. The President has cited alleged race discrimination in its admission policies and other areas impacting campus life.
- Musk Out? After weeks of speculation, Elon Musk has hinted that his role in Washington may soon come to an end. In a widely watched interview with CBS News, Musk expressed deep frustration with reforming the federal bureaucracy, stating it was “much worse than (he) realized.” He claimed that he, DOGE, and his companies are being unfairly targeted, adding, “People are burning Teslas. Why would you do that? That’s really uncool.” Musk also voiced concern that President Trump’s proposed budget spending could wipe out any cost savings generated by DOGE.
"As trade negotiations continue and deadlines approach, President Trump’s domestic budget
- “One Big Beautiful Bill Act” - passes the US House, and now heads into the US Senate where the debate over its impact on taxes, healthcare, and low income assistance will continue”
Jackson Dunn
Head of Public Affairs, Americas
For more information about FTI’s Public Affairs services in the Americas, please contact [email protected].
German government eyes 5% defense spending
- On May 22nd, Chancellor Friedrich Merz (CDU) and Defense Minister Boris Pistorius (SPD) participated in the formation ceremony of the German Armed Force’s 45th Armored Brigade in Lithuania. Originally launched by the previous government under the same Defense Minister, the brigade reflects the spirit of the “Zeitenwende” as a broad shift in Germany’s defense policy. In the course of the ceremony, Merz confirmed the goal of raising defense spending to 3.5% of GDP by 2032, with an extra 1.5% proposed for defense relevant infrastructure. The move signals to NATO and especially Washington that Germany is ready to take on a leading role in European defense, aiming to become the Europe’s strongest conventional land force.
- Foreign Minister Johann Wadephul (CDU) publicly proposed raising Germany’s defense spending to 5% of GDP before Merz’ announcements in Lithuania. His statement came before any agreement with Chancellor Merz or SPD leader Lars Klingbeil, and reportedly took both by surprise. Although Merz and Pistorius later echoed the proposal during their visit to Lithuania, the incident revealed a lack of internal coordination.
- Chancellor Merz’s visit to Lithuania and his remarks with regards to Germany’s defense budget reflects the federal government’s intent to seize a historic opportunity: for the first time in decades, sweeping defense investments are politically and financially possible. Enabled by recent constitutional reforms and broader parliamentary support, Germany can now make bigger moves to rapidly enhance its military capabilities. This marks a deliberate shift not just to meet U.S. expectations, but to redefine Germany’s role within NATO. However, the challenge ahead lies in structural reforms: without overhauling the notoriously complicated procurement system, increased spending risks being wasted. In Vilnius and beyond, hopes are high that Berlin will now match resources with real delivery.
"This shift opens up major potential for the defense industry, including for companies focused on soft defense and dual-use infrastructure. But without reform and long-term political backing, much of that potential may never materialize.”.”
Claas Bansemer
Senior Director; Public & Government Affairs Germany, Berlin
For more information about FTI Consulting’s Public Affairs services in Germany, please contact [email protected]
After Geneva: underlying differences stand out amid tariff ceasefire
- China’s tactical rare earth “pause” operates through an approval-based system rather than a full rollback of export curbs. By requiring ministry-level licenses for key minerals, Beijing signals calibrated de-escalation while preserving strategic leverage over inputs vital to electronics, defense, and broader national security industries.
- Washington doubled down on AI-chip embargoes, issuing a global ban on the use of advanced Chinese chips – explicitly naming Huawei’s Ascend series, marking the latest escalation in a broader campaign targeting China’s semiconductor capabilities. In response, Beijing has warned that any enforcement of the ban could trigger countermeasures under its Anti-Foreign Sanctions Law.
- The 90-day tariff truce established a consultative mechanism neither open-ended nor immune to derailment. Despite formal de-escalation, both sides continue to trade policy barbs. Beijing is also hedging its bets – pursuing litigations, exploring multilateral cooperation, and courting Global South partners – to resist U.S. tech containment and probe Washington’s appetite for reciprocal concessions.
"At the tariff truce’s midpoint, underlying strategic mistrust remains, and the outlook seems tenuous. China’s approval-based rare earth ‘pause’ and the U.S.’s expanded AI-chip crackdown reveal that both sides still prioritize leverage over resolution, following a tit-for-tat logic of ‘you escalate, I escalate; you de-escalate, I de-escalate’. As disputes over subsidies, investment restrictions, and tech decoupling persist – and both capitals position themselves with their partners for greater bargaining chips – the consultation mechanism set in Geneva may merely delay the next round of tensions, leaving industries and businesses to navigate prolonged uncertainty and regulatory fragmentation."
Rachel Hsueh
Head of Strategic Communications, China
For more information about FTI’s Public Affairs services in China, please contact [email protected]
Labour’s U-turn on welfare put Reeves’ rigid fiscal rules at risk
- The Labour Government has been warned that its decision to potentially remove the two two-child benefit cap and U-turn on their decision to cut winter fuel payments may jeopardize Chancellor of the Exchequer Rachel Reeves’ strict fiscal rules. Prime Minister Sir Keir Starmer announced on 21 May that he would ease cuts to winter fuel payments following the controversial decision to remove the benefit to around 10 million pensioners last year. Starmer is also reportedly considering scrapping the two-child benefit cap, with Minister for Women and Equalities Bridget Phillipson telling Sky News on 27 May that lifting the cap was “not off the table”.
- The winter fuel cuts proved highly unpopular with voters in this month’s English local elections, where Nigel Farage’s Reform UK made major gains, winning 41% of the seat share. As Farage sharpens Reform’s position on welfare, also vowing to scrap the two-child benefit cap and reinstate winter fuel payments, Starmer’s apparent backtracking on welfare reform is partly aimed at recapturing the support of voters considering Reform.
- However, the decision to reinstate winter fuel payments for most pensioners will cost the Treasury £1.5bn. Removing the two-child benefit cap would cost a further £3.5bn. The U-turn on welfare is another blow to Reeves amid speculation that she will be forced to raise taxes in the Autumn Budget coming later this year, breaking the rigid fiscal rules promised in 2024. With the Chancellor already facing a shortfall of around £60bn in the public finances due to stagnant growth and rising borrowing costs, expanding welfare spending adds to the fiscal strain. Labour’s hands are largely tied – breaking the self-imposed fiscal rules risks backlash from financial markets, undermining the party’s economic credibility and marking a significant political concession.
“The U-turn on welfare puts Labour in a difficult position, with the party seemingly unsure on where they stand on the protection of vulnerable citizens. Politically, Labour are caught between appeasing the voters drifting towards Reform and maintaining their steadfast commitment to Reeves’ fiscal rules, which ultimately defines their economic credibility. The U-turn adds to broader doubts about Labour’s overall policy direction, creating another layer of uncertainty for UK businesses and financial markets. The party’s tension between responding to public pressure whilst also standing firm on fiscal discipline remains unresolved, with critics questioning how long Labour can increase spending without breaking Reeves’ fiscal rules.”
Ollie Welch
Managing Director, United Kingdom
For more information about FTI’s Public Affairs services in the United Kingdom, please contact [email protected]
Apple in tariff crossfire as Trump tells Cook "Don't Make in India”
- US President Trump said in May that while Apple is free to build factories in India, it will face 25% tariffs if it sells those products in the USA. This would apply to other firms too, he added. Apple plans to shift iPhone assembly for the US market to India by 2026, driven by tariff and other risks, meaning it could double India output to over 60 million in 2026. This makes Apple a showcase for New Delhi’s make-in-India and China-plus-one propositions.Despite the tariff warning, Apple is deepening its India play. On May 22, its top supplier Foxconn committed $1.5 billion to expanding iPhone production in the country. Even with a 25% US tariff, Indian-made iPhones will cost just $38 more per unit, against a $390 premium for US assembly, thanks to labor costs.
- Despite the tariff warning, Apple is deepening its India play. On May 22, its top supplier Foxconn committed $1.5 billion to expanding iPhone production in the country. Even with a 25% US tariff, Indian-made iPhones will cost just $38 more per unit, against a $390 premium for US assembly, thanks to labor costs.
- In the backdrop are US-India talks on a bilateral trade agreement during a 90-day pause on Trump’s ‘reciprocal taxes.’ Negotiators and ministerial delegations recently met in Washington, aiming to finalize a deal by July 8. New Delhi seeks exemption of the 26% tariff announced on India-sourced products and is offering zero tariffs on select US goods.
"Trump’s latest salvo spells continued tariff-and-trade uncertainty for USA’s partners, not just for India. But global tech firms invest for the long term: Apple has developed over a dozen suppliers in five Indian states, and is an icon for New Delhi’s ‘China+1’ proposition for manufacturers. Even so, with the USA as the 3rd largest investor in India, a lot is riding on the outcome of the bilateral trade negotiations between the countries.
Pragya Gupta
Director, India
For more information about FTI’s Public Affairs services in India, please contact [email protected].
Ireland unveils its new Semiconductor Strategy
- Last week, Ireland unveiled its new Semiconductor Strategy, Silicon Island. The strategy fulfils a key Programme for Government commitment and sets an ambitious goal of creating 35,000 jobs in the sector by 2040. Ireland already hosts a robust semiconductor sector, with over 20,000 people employed and 15 of the world’s top 30 firms operating in the country.
- A central objective of the strategy is to secure three major fabrication plants: one leading-edge facility for high-performance chips (akin to Intel’s current site) and two trailing-edge fabs for lower-end semiconductors.
- The cornerstone of the plan is the state acquisition and preparation of “strategic sites” – utility-rich, high-cost infrastructure investments intended to attract major firms through strategic subsidies. Minister for Enterprise, Trade and Employment, Peter Burke, is expected to bring a proposal to Cabinet in the coming months detailing the location and budget of the first site. It remains undecided whether the sites will be sold at cost or leased at preferential rates.
"Ireland’s renewed commitment to the semiconductor sector is a natural evolution of its longstanding success with Intel and its proven ecosystem providing construction, talent, and services for the semiconductor industry. However, industry stakeholders have flagged concerns over high energy costs and Ireland is facing increasing global competition to attract the sector. With each ‘utility-rich’ site potentially costing €2 billion, the government faces a delicate balancing act between fiscal prudence and strategic investment. In an new era marked by global trade uncertainty and an increased focus on the importance of Foreign Direct Investment to Ireland, ensuring Ireland remains a compelling destination for semiconductor investment will be more vital for the Government than ever."
Declan Kearney
Managing Director, Ireland
For more information about FTI Consulting’s Public Affairs services in Colombia, please contact [email protected].
President Macron embarks on southeast Asia tour, positioning France and the EU as reliable alternatives to “impulsive superpowers”
- On May 25, President Emmanuel Macron began a three-country tour of Southeast Asia, visiting Vietnam, Indonesia, and Singapore. Since his election in 2017, the Indo-Pacific has become an increasingly important region for France, which—through its overseas territories of New Caledonia and French Polynesia—seeks to play a responsible role in maintaining stability and upholding international law.
- While the trip had a clear economic focus—Macron signed major deals, including for Airbus aircraft—it also served two of his strategic priorities: presenting France and, more broadly, the EU as reliable partners amid growing superpower volatility; and securing Indonesia’s support for the upcoming conference on a two-state solution to the Israel-Palestine conflict, which France is co-hosting in June.
- In Vietnam, Macron promoted a “third way,” presenting France as a champion of “freedom” and “sovereignty” and warning that impulsive actions by global powers such as the U.S. and China could destabilize Southeast Asia. In Indonesia, he gained President Prabowo Subianto’s backing for the June conference. Notably, Prabowo stated that Indonesia would be prepared to recognize Israel if Israel recognized a Palestinian state—a major development. This marks a significant shift for the world’s largest Muslim-majority nation, which has traditionally rejected ties with Israel, and lends diplomatic weight to renewed efforts toward a two-state solution.
“President Macron’s Southeast Asia tour reflects a nuanced diplomatic strategy that blends economic outreach with geopolitical positioning. By framing France—and, by extension, the EU—as a stabilizing force in an increasingly polarized Indo-Pacific, Macron is carving out a distinct ‘third way’ amid U.S.-China rivalry. His success in securing Indonesia’s tentative openness to Israeli recognition also underscores a significant, if cautious, shift in regional dynamics, lending momentum to France’s efforts to revive the two-state solution, help repair strained Franco-Israeli relations, and reposition Europe as a credible mediator in global affairs."
Gregory Grellet
Senior Managing Director, France
For more information about FTI’s Public Affairs services in France, please contact [email protected]
President Ramaphosa’s R1.3 trillion Infrastructure Drive Poised to Spur Growth and Restore Investor Confidence
- The R1.3 trillion pipeline announced by President Ramaphosa at the Sustainable Infrastructure Development Symposium South Africa (SIDSSA) 2025 signals a deliberate reactivation of the state’s developmental role, positioning infrastructure not just as physical capital, but as a lever for industrialization, inclusive growth, and regional economic competitiveness, all of which are anchored in coherent institutional coordination via Infrastructure South Africa (ISA).
- By unlocking R102 billion in blended finance and streamlining approval processes (e.g., 75% of permits resolved in 85 days), government is actively de-risking infrastructure investment and creating bankable projects that attract private capital, while addressing historical implementation failures such as regulatory duplication and stalled delivery.
- ·The integration of SIDSSA with the AfCFTA agenda repositions South Africa as both a gateway and a connector for regional trade. By embedding infrastructure projects within a broader African economic architecture, the initiative aligns domestic development goals with continental market expansion, and by so doing amplifying the impact of physical connectivity on trade efficiency, investor interest, and economic diversification.
"President Ramaphosa’s R1.3 trillion infrastructure plan represents a historic turning point in South Africa’s development trajectory. With more than 250 procurement-ready projects across sectors and a sharpened focus on regulatory reform, blended finance, and regional integration, this initiative signals a credible, execution-focused shift from past failures. If effectively implemented, it could restore investor confidence, stimulate economic growth, and position infrastructure as a real engine of national transformation.”
Lelo Skosana
Senior Director, South Africa
For more information about FTI’s Public Affairs support in South Africa, please contact [email protected].
New constitutional court magistrate elected: key for reforms and popular consultation proposed by the current administration
- On May 20th, the Senate elected Héctor Carvajal to the Constitutional Court with 66 of 101 votes, from a shortlist by President Petro. Carvajal previously represented Petro before the National Electoral Council (CNE), defending him in campaign finance investigations during his presidential run.
- Although he lacks constitutional law experience his political ties are relevant to upcoming rulings on pension reform, labor reform, and a proposed popular consultation.
- Another factor highlight he could have a short term at the Court: At 66, Carvajal must retire at 70, as required by Article 233 of the Constitution and Law 1821 of 2016. His attempt to bypass this limit has been widely rejected by legal scholars.
"Two more magistrates will be selected this year in June and September, both from shortlists prepared by the Supreme Court of Justice. Despite Petro’s growing influence on the bench, the Constitutional Court is expected to remain independent and could lean more conservative after upcoming appointments”
Juliana Gómez
Head of Public Affairs, Colombia
For more information about FTI Consulting’s Public Affairs services in Colombia, please contact [email protected].
Limited EU support puts domestic agenda under strain
- On May 28, 2025, Prime Minister Pedro Sánchez met with European Commission President Ursula von der Leyen in Brussels marking their first official encounter since the start of her renewed mandate. The discussion covered several EU-level priorities, including the transatlantic trade relationship, defense and foreign policy, the need for a Commission-led housing strategy, and energy interconnections between the Iberian Peninsula and the rest of Europe.
- While the meeting focused on broader issues, it took place against a backdrop of mounting tension over Spain’s stalled proposal to make Catalan, Basque, and Galician official languages of the European Union. This initiative was put forward by the Spanish government under pressure from separatist allies such as Junts per Catalunya, and has encountered firm resistance within the EU.
- Concerns have been raised over its legal feasibility, economic costs, and operational complexity and, as a result, Spain has been forced to postpone the vote and effectively put the initiative on hold following discussions in Brussels.
“The failure to secure EU recognition for these regional languages has significant domestic implications for the Sánchez government. The proposal was a key concession to separatist parties like Junts per Catalunya, whose support is crucial for the government's legislative agenda, including the approval of the national budget. With the initiative now stalled, tensions within the ruling bloc may grow, increasing the risk of complicating the government’s ability to deliver on its broader agenda.”
Marc Martínez
Director and Public Affairs Industry Lead, Spain
For more information about FTI’s Public Affairs services in Spain, please contact [email protected].
Brazil has no appetite to shrink the State
- Persistent inflation and structural fiscal imbalances continue to cloud Brazil’s macroeconomic outlook. Looking ahead to the 2026 elections, President Lula seeks to secure a Senate majority to contain the rise of bolsonarismo. In this context, fiscal discipline becomes a political imperative—crucial to maintaining alliances and delivering legislative wins.
- In a bid to meet its ambitious zero-deficit fiscal target for 2024, Brazil’s economic team announced a surprising R$31.3 billion in budget restraints. The package includes R$20.7 billion in formal contingencies and R$10.6 billion in spending freezes, alongside an increase in the IOF (Tax on Financial Operations), a levy on credit, foreign exchange, insurance, and securities transactions.
- However, the IOF hike, announced Thursday (May 22), was partially reversed the same day following heavy market backlash – The government walked back the tax increase for domestic funds investing abroad. Amid ongoing scrutiny, the Senate’s Economic Affairs Committee approved a request to hear Minister Haddad on the measure. Critics argue that the decree presents clear legal flaws and constitutes an overreach of executive power, violating constitutional boundaries set for tax policy.
“These events evidence Lula’s recognition of persistent macroeconomic risks, including inflation and structural fiscal imbalances. Managing spending is no longer just an economic goal—it is central to maintaining key alliances and advancing the president’s legislative and electoral agenda. But with no appetite to shrink the state, the government treats every fiscal problem as a tax opportunity—often without a plan for the consequences.”
Raquel Rocha
Senior Director, Brazil
For more information about FTI’s Public Affairs services in Brazil, please contact [email protected]
Expert Analysis |
Snapshot: Did the UK-EU Summit deliver for defence?
The Labour Government’s UK-EU Summit has long been held up as a potential landmark moment in the post-Brexit relationship between London and Brussels.
Among the swathe of warm words and good intentions regarding the UK-EU defence relationship, read the latest snapshot from FTI Consulting’s Public Affairs experts in London and Brussels as they consider whether the Summit delivers for each party’s respective defence industries.
Timeless tactics: crafting growth strategies that last
Amid uncertainty, general counsels, as well as boards and CEOs, need to develop a growth strategy that can stand the test of time.
By “organizing and executing a proper risk assessment, they can inoculate the company and make sure their plans are not met with inadvertent and devastating consequences,” says Jackson Dunn, our Americas Head of Public Affairs.
FTI Consulting’s approach to global issues
Global regulation is shifting – slow like tectonic plates, but when they move, the impact is seismic.
Senior Managing Director Ali Karami Ruiz explains the ways in which FTI Consulting helps leaders to navigate these powerful forces early, turning insight into action so clients can shape the rules before they’re written.
Encuentro de Consejeros (Meeting of Counsellors)
Brussels-based Director and defence expert Beatriz Cózar Murillo was invited to speak about European defence and the current geopolitical situation in Madrid last week at “Encuentro de Consejeros” (“Meeting of Counsellors”), organised by the Institute of Internal Auditors of Spain.
She shared her insights about Defence Readiness 2030/ReArm Europe, competitiveness, risks and business opportunities.
Upcoming Conferences, Elections and Webinars
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- 05 June: Parliamentary elections (Burundi)
- 07 June: Local elections (Latvia)
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