Geopolitical volatility – encompassing regional conflicts, intense global competition for influence and resources;, and control of new technologies – is reshaping markets, reconfiguring trade and supply routes, and refocusing both government policy and business strategy.
Business leaders value certainty but increasingly operate in a world where major powers project strength, conflict is widespread and fundamental transitions are taking place across energy and technology.
The year to date has been exceptionally volatile, with the immediacy of the conflict in Iran and the closure of the Strait of Hormuz showing that geopolitical flashpoints can have a far-reaching impact across the global economy, creating tighter conditions in the operating environment for business.
While geopolitical events can appear distant, their ripple effects can be wide ranging. The economic impacts of the conflict in Iran are likely to be felt for some time regardless of any peace deal, putting pressure on prices, increasing the cost base of businesses, and impacting the UK’s overall economic growth outlook. Consumers, many of whom are already stretched, may rein in spending further. It makes the trading landscape a tougher place.
