As 2026 approaches, geopolitical risks continue to evolve in a multipolar world characterized by persistent volatility, great-power competition, and interconnected threats that transcend traditional boundaries. Forecasts from leading analysts highlight a landscape where state interventionism and protectionist policies dominate, with governments increasingly deploying tariffs, subsidies, and export controls to safeguard economic security. This shift is expected to disrupt global supply chains, raising operational costs by an estimated 10-15% in key sectors like manufacturing and energy, while fostering regional trade blocs that could fragment the global economy further. The U.S.-China rivalry remains central, with ongoing trade truces holding fragile amid disputes over technology and intellectual property, potentially leading to escalated tariffs or investment restrictions that affect multinational corporations’ strategies.

Concurrently, resource scarcity—particularly in critical minerals and water—emerges as a flashpoint, with competition for rare earths and freshwater rights intensifying due to demands from AI data centers and battery production, risking conflicts in regions like the Asia-Pacific and Middle East.

Conflict zones represent the most acute risks, with high-priority contingencies underscoring the potential for escalation in ongoing wars and new flashpoints. In Europe, the Russia-Ukraine conflict is projected to intensify through expanded infrastructure attacks and hybrid tactics, carrying a high likelihood of spillover into NATO territories and straining global energy markets.  The Middle East faces renewed instability, including potential Israel-Iran clashes amid proxy rebuilds and nuclear ambitions, alongside fragile ceasefires in Gaza and Yemen that could unravel, disrupting oil supplies and Red Sea shipping lanes.  Asia-Pacific tensions, particularly around Taiwan and the South China Sea, are rated as moderate-to-high impact, with China’s economic and military pressures potentially precipitating crises involving U.S. allies, while North Korea’s nuclear tests could heighten Korean Peninsula risks.  Domestically, the U.S. grapples with political violence and unrest, which could paralyze foreign policy responses, while emerging markets in Africa and Latin America contend with insurgencies and state collapses, such as in Sudan or Venezuela, exacerbating humanitarian crises and migration pressures.

Technological and cyber domains amplify these risks, positioning AI as both a strategic asset and vulnerability in 2026. Sovereign AI initiatives will treat advanced technologies as critical infrastructure, fueling cyber conflicts and decoupling efforts between the U.S. and China, where export controls on chips and algorithms could hinder innovation and raise compliance costs for tech firms.   Elevated attention to AI-enabled cyberattacks on critical infrastructure, with moderate likelihood but high impact on U.S. and global systems, alongside a potential AI market bubble burst that exposes financial vulnerabilities amid high debt levels.  Terrorism and hybrid threats, including drone warfare and proxy actions, are also on the rise, with resurgent groups like ISIS in Syria posing risks to Western interests and business operations in unstable regions.

Regional dynamics further complicate the outlook, with Europe at a crossroads due to internal divisions and external pressures from Russia, potentially weakening its economic competitiveness and defense posture.

North America’s policy volatility, including USMCA reviews and U.S. midterm elections, could reshape supply chains and trade patterns, while the Middle East undergoes recalibration with heightened economic competition among global actors.  In the Asia-Pacific, balancing economic integration with security concerns will test alliances, amid China’s pivot to export-led growth and Global South nations driving half of global expansion.

Climate divergence adds another layer, as fragmented policies on decarbonization and energy security hinder global coordination, with opportunities in low-carbon tech overshadowed by geopolitical leverage in mission-critical sectors.

While there is a cautious optimism from diplomatic truces and market adaptations, the consensus points to a year of ambient rivalry rather than outright catastrophe, urging businesses to build resilience through diversified strategies, geopolitical integration in planning, and proactive risk mitigation.

Galactik Views