We have entered a new world economy shaped by two fundamental forces: geoeconomic fragmentation and exponential innovation. In this environment, established cooperative and diplomatic frameworks are under pressure, requiring much more dialogue, imagination and entrepreneurship to regain forward momentum. At the same time, technology and innovation are being deployed at unprecedented speed, with companies playing an ever-greater role.
These shifts are transforming how businesses operate across geographies. On one hand, we are seeing the return of governments reasserting themselves as central economic actors, redrawing economic boundaries and forging new blocs through measures, including industrial policy, tariffs and massive investments, in key domestic companies. On the other hand, rapid and large-scale technological advances, such as artificial intelligence, are generating vast opportunities and changing what it means to compete.
This volatile and uncertain landscape, where geopolitical disruption and exponential technological innovation are deeply intertwined, has profound implications for how industry should approach business strategy. Business leaders can no longer solely rely on managing volatility as it arises. Instead, they must build foresight directly into their operating models and develop the ability to adapt continuously in a world defined by contested norms, shifting alliances and the erosion of trust. At the same time, they will need to discern enduring signals amid pervasive noise. Success will require treating these dual, interconnected forces as core pillars of business strategy – not add-ons.
Geoeconomics is the new geopolitics
The global trading system is entering a pivotal moment. With intensifying competition redrawing trade and investment flows as well as global influence and regional stability, long-held assumptions about security, sovereignty and impact are being challenged in real time.
World Trade Organization economists estimate global goods trade growth slowed only slightly to 2.4% last year and global services exports to 4.6%. Yet the nature of trade cooperation is changing. Plurilateral deals on digital trade and facilitating foreign direct investment (FDI) are under consideration by more than 100 economies. New mega-regional deals are landing, such as the EU-Mercosur comprehensive partnership and trade agreement expected to be signed this month.
As trade flows diversify, governments need to streamline trade and investment processes to connect to new value chains. Companies will need to be agile to seize changing market opportunities. Digital trade, for example, is experiencing robust growth, expanding by about 12% annually across the past five years, while for merchandise trade, AI-related goods such as semiconductors were responsible for nearly 43% of growth in the first half of 2025.
From AI to AI super systems
Amid growing geopolitical fragmentation, AI is evolving into an AI Super System – a tightly interconnected configuration of energy systems, physical infrastructure, capital and strategic partnerships that determines how AI-driven economic value can scale. In this phase, advantage is shaped less by individual technologies and more by how effectively system components reinforce one another. Compute depends on power and grids; infrastructure requires long-term capital; financing decisions influence where assets are built; and scale increasingly relies on cross-sector and cross-border partnerships.
A new geoeconomic “arms race” to secure dominance in data, computing power and innovation is already underway, since technological sovereignty can translate into lasting economic and societal value. AI infrastructure, in particular, is attracting gigantic investments: global capital expenditure in the sector reached at least $400 billion in 2025, and is projected to top $750 billion by 2029. While this does come with significant energy costs, it is also driving positive investments in energy generation and infrastructure. These interdependent factors all determine who will capture the potential of AI, alongside the $15 trillion it could add to global GDP by 2030 and the vast associated productivity gains it could bring.
This all means that companies in AI-related fields – from those building large language models to those supplying relevant materials and infrastructure – are of growing strategic value.
Governments everywhere are forging closer relationships with AI and tech firms; more and more, they may seek to play a more active role in overseeing these companies to address national security considerations. The same is true in strategic sectors including energy, semiconductors, logistics and more. Critical minerals, for example, now play a role similar to that of oil in past conflicts and economic shocks. Disruptions to access to these resources will be crucial to watch in the years ahead. More robust international interoperability could help to manage risks.
Three coping mechanisms for businesses
Faced with these challenges, there are three core strategies that businesses should adopt. First, staying up to date. In this dynamic new economy, businesses must recognize that much of the knowledge needed to navigate it is still being formed, so they need to create new playbooks and continuously iterate with peers.
Second, it is important to remain grounded in a systems-wide view of the challenges ahead, given the growing interconnectedness of sectors.
But above all, for businesses across all sectors, the complexity of the emerging global economic order demands mastering continuous adaptation. That means moving beyond resilience and agility; it is not just about survival, but playing offense. This can be achieved by integrating both change and continuity across operations, creating systems that evolve constantly rather than react episodically. For firms navigating a world that is becoming more regionalized, strategically contingent and risk-aware, resilience will be strengthened not by seeking stability but by learning to operate confidently within instability.
As these geopolitical and technological shifts prompt both policy-makers and business leaders to play a greater role in each other’s traditional arenas – governments as economic actors, and businesses in what were previously considered matters of state – the need for constructive engagement is clear. In this context, impartial platforms for public-private dialogue, such as the World Economic Forum Annual Meeting 2026, convened under the theme ‘A Spirit of Dialogue’, are increasingly vital for navigating this new era, both in terms of opportunities and risks.
The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.
The post Geoeconomics is the new geopolitics: Playing offense in the new economy appeared first on Fortune.
