As 2026 approaches, geopolitical forces are increasingly shaping global business and trade dynamics. The global landscape is becoming more multipolar, with economic influence distributed across a wider set of countries rather than dominated by a single power. This shift is driving companies to reassess where they invest, manufacture, and source goods, as geopolitical risk has become a core strategic consideration rather than a peripheral concern.
A major development is the continued expansion of production capabilities in China, India, and the Middle East. China is deepening its industrial and technological capacity while maintaining a strong export orientation. India is emerging as a critical manufacturing and services hub, supported by policy initiatives and growing integration into global supply chains. Middle Eastern economies are investing heavily in downstream manufacturing, logistics, and energy-related industries, seeking to diversify away from hydrocarbons and position themselves as global production and trade centers. Together, these regions are reshaping global supply patterns and offering alternatives to traditional manufacturing bases.
At the same time, ongoing global conflicts continue to create uncertainty. Wars and regional tensions are disrupting trade routes, energy supplies, and investment flows, while increasing volatility in commodity prices and logistics costs. These conditions complicate long-term planning and reinforce the need for resilience and flexibility in supply chains.
Trade policy remains a focal point in 2026. While tariffs and trade wars are less politically polarizing than in earlier years, they continue to have tangible economic effects. Tariffs directly raise the cost of imported materials and components, affecting competitiveness and sourcing decisions. As a result, companies are placing greater emphasis on tariff management, supplier diversification, and regionalization of production. Overall, geopolitical fragmentation, regional production expansion, and persistent trade frictions are redefining how businesses compete and operate globally.
https://www.bcg.com/publications/2025/geopolitical-forces-shaping-business-in-2026
