The global economy is undergoing a significant transformation from decades of deepening globalisation to a new phase of fragmentation driven by geopolitical tensions. Trade, investment, and technology are increasingly organised along competing political blocs, with countries prioritising resilience and security over efficiency. This shift is marked by rising tariffs, trade restrictions, and a focus on partnerships with politically aligned or geographically closer nations.

Supply chains are being restructured to reduce dependence on rivals, following recent crises that exposed vulnerabilities in the traditional global model. The rivalry between major powers, particularly the US and China, is intensifying competition in key technologies such as artificial intelligence, further contributing to this fragmentation.

While some experts see this reorganisation as a move toward a more balanced and resilient world economy, others warn it may lead to higher costs, reduced innovation, and slower global growth. Policymakers and businesses face the challenge of balancing security with efficiency as globalisation evolves into a more complex and politicised phenomenon.