Notes on a world in change
Reflections shaped during the Helsinki Geoeconomics Week, where discussions underlined how globalisation’s certainties are giving way to regional strategies and resilience.
It is clear we are at a pivotal moment in the arc of history. When we look back in a few years, we may see the thirty-year period from the Soviet collapse to the COVID-19 pandemic as an aberration—a singular moment in history when one power overwhelmingly dominated the global economic and political system.
That is changing rapidly. An engaging few days at the Helsinki Geoeconomics Week helped me put my thoughts together, and offered a chance to think about the changes around us.
Some takeaways reinforced my beliefs; others made me think.
Industrial policy is back. Once considered a pariah, it is now mainstream in Washington, Brussels, Beijing and beyond—as long as one calls it “strategic”.
Industrial policy is different this time. The goal is not to create national champions this time around, but to ensure parity in critical sectors. Some are calling it Commanding Heights 3.0: the state reclaiming control over strategic industries, from semiconductors to energy.
Regionalisation, not globalisation. We are in a world of selective free trade, layered with heavy-handed industrial policy. Regional blocs and bilateral deals are the order of the day. RCEP, the Indo-Pacific Economic Framework, and a web of mini-laterals and bilaterals are filling the space once held by multilateral liberalisation.
Supply chains are split. The bifurcation in supply chains is here and real. Technology is the clearest example, but pharmaceuticals, rare earths and green tech are also reordering around blocs.
1990–2020 was unusual. That thirty-year window of relative peace and open trade looks like an aberration. Globalisation in the “world is flat” form may never have been the normal.
The old normal isn’t coming back. We’re now in an era where resilience and security matter more than efficiency and cost, and companies’ actions are being shaped by these factors.
This isn’t a new Cold War. The US and Soviet Union barely touched each other’s economies. The economies of the US and China, on the other hand, are deeply entangled, which makes outcomes less predictable. The interdependence raises both the risk of miscalculation and the cost of conflict.
Crises keep coming. GFC, Covid, Brexit, Russia’s invasion, US policy swings — “once-in-a-lifetime” shocks are arriving one after another. The challenge is not only to build resilience, but to find the opportunities these disruptions create.
Business paralysis. Many companies have been frozen by the sheer speed of change, resulting in investment and operational decisions being postponed. Firms keep pushing off the costs of resilience—be it building redundancy or diversifying suppliers, resulting in lost competitiveness and increased political vulnerability.
Corporates as political actors (tools?). Multinationals no longer have the option of neutrality. Apple, BlackRock and TSMC show how companies either operate as political players or are made to.
Structural drivers cannot be escaped. Demographics, inequality, sustainability and politics are no longer macro themes confined to the background. They are also operational constraints for businesses.
These were some of my notes from Helsinki. I suspect we will be revisiting these themes for some time to come.