Geopolitical Risk Should Be At Forefront Of Company Strategy – Research

Geopolitical consequence is nary longer distant from day-to-day business concerns arsenic it has historically tended to be, a caller study states.

The 4th version of GlobalData’s Geopolitics Executive Briefing advises that companies successful each sectors should now beryllium paying changeless attraction to geopolitics. It explains that nan starting constituent for this contention is “the chronic, intensifying and still-early-stage superpower rivalry betwixt nan US and China, successful which economical weapons (sanctions, export controls, tariffs) are nan instrumentality of first recourse.”

The emergence of China challenging nan position of nan US arsenic nan world’s sole superpower underpins nan first of six reasons fixed for companies to salary changeless attraction to geopolitics – that location is now “nowhere to hide” from its effects.

“The adversarial zero-sum move of nan US-China rivalry, which progressively dominates world affairs, must beryllium considered successful galore governmental and business decisions to negociate consequence and grasp opportunities, notably successful narration to non-aligned countries for illustration India,” GlobalData, Just Food‘s parent, explains.

The different reasons fixed are that location is “no extremity successful sight” owed to nan US-China rivalry being successful its early stages, location are “powerful economical spillovers” done a backdrop of hyper-globalisation and hyper-digitalisation, nan usage of business and finance now arsenic “economic weapons”, perceived grounds that nan issues astatine liking let nary room for discuss and nan imaginable for “contagion and polycrisis” whereby geopolitical tensions and different world crises provender disconnected each different to go self-perpetuating.

The study notes that nan re-election of Donald Trump arsenic US President resulted successful a bid of shocks, specified arsenic nan implementation of tariffs upending nan postwar world trading strategy and nan related intensification of nan US-China struggle successful tech and captious minerals.

However, it adds: “The astir superior threats to trade, proviso chains and finance materialise erstwhile geopolitical tensions erupt into existent and imaginable equipped conflicts, which person proliferated this twelvemonth from nan chronic and bloody battles successful Ukraine and Gaza to new, albeit brief, wars successful Iran, South Asia and South-East Asia.”

“The business risks stemming from each these caller and continuing wars would ray beside immoderate imaginable conflicts successful East Asia – astir Taiwan first and foremost, but pinch explosive imaginable besides connected nan Korean peninsula and successful nan South China Sea.

“Some sectors – notably tech and power (including greenish energy) – are exceptionally ‘geopoliticised’, making them liable to beryllium weaponised. Geopolitical tensions person go entangled successful different world challenges – namely, nan ambiance situation and expanding migration – pinch beardown feedback loops.”

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  Strategic Intelligence: Global Economic Outlook Executive Briefing (11th Edition)

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  Strategic Intelligence: Tariffs and Trade Wars Executive Briefing (Third Edition)

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  Strategic Intelligence: Geopolitics Executive Briefing (Fourth Edition)

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