EY’s Top 10 Geopolitical Risks to Watch for in 2024

0
213

The 2024 Geostrategic Landscape: Trends and Challenges Ahead

In the ever-evolving landscape of global geopolitics, 2024 is shaping up to be a year of significant change and uncertainty. Smaller countries and non-state actors are seizing opportunities to redraw boundaries and shape their corner of the geopolitical multiverse, with the war in Ukraine and conflicts in other parts of the world potentially just the beginning.

One of the key features of geostrategy in 2024 will be the de-risking of global supply chains. The COVID-19 pandemic and the war in Ukraine have highlighted the vulnerabilities of countries’ global dependencies and the challenges of achieving resilience with just-in-time and globalized supply chains. Governments are responding by reengaging in industrial policy and promoting greater domestic production of critical products, embedding geopolitical competition into economic and national security policies.

Another important aspect of geostrategy in 2024 will be the race to innovate on and regulate artificial intelligence (AI). Governments around the world will be racing to regulate AI to reduce sociopolitical risks while also fostering domestic AI innovation to compete geopolitically. This will accelerate the shift toward distinct geopolitical blocs, particularly in US-China relations.

Additionally, the geopolitics of the oceans will take on greater prominence in 2024. With the oceans being home to 94% of all life on the planet and a crucial economic and national security resource, the geopolitical implications of maritime routes and deep-sea mining will become more significant. Companies will need to consider ocean geopolitics when setting their supply chain and sustainability strategies.

Furthermore, 2024 will be a year of elections, with voters heading to the polls in markets representing a significant portion of the global population and GDP. These elections will generate regulatory and policy uncertainty, with potential impacts on the global business environment.

Overall, the 2024 Geostrategic Outlook is characterized by a complex mix of alliances and rivalries, with the likelihood of geopolitical surprises on both the downside and the upside. As executives seek to anticipate and plan for geopolitical disruptions, the themes of multipolarity and de-risking will be crucial to keep in mind. With geopolitical power becoming more dispersed and countries prioritizing national security over purely economic considerations, organizations across sectors and geographies will need to navigate these challenges in the year ahead.