Current global political and economic landscapes are defined by heightened uncertainty, a shift toward protectionism, and the disruptive influence of artificial intelligence. Major institutions project a “stable yet underwhelming” economic growth path for 2025–2026 as nations navigate a “geopolitical recession” characterized by fragmented alliances.
CIDOB +3
CIDOB +3Political Trends
- Rise of “Ego-Politics”: A shift toward personalism and anti-establishment leadership is emerging, exemplified by figures like Donald Trump and Javier Milei who bypass traditional party structures.
- Geopolitical Fragmentation: The world is moving toward a multipolar or “G0” order where middle and great powers contest regional rules, leading to a decline in the Western-led international system.
- State-Based Armed Conflict: Conflict has become the most pressing material risk in 2025, driven by ongoing wars in Ukraine, the Middle East, and Sudan, alongside rising tensions in the South China Sea.
- Dismantling of Institutions: Global bodies like the UN, WTO, and ICC face a crisis of legitimacy and funding as major powers increasingly prioritize unilateral or transactional diplomacy.
- Digital Polarization: AI-generated misinformation and disinformation are ranked as top risks for their ability to sway elections and deepen societal divides.
The World Economic Forum +5
Economic Trends
- “Maganomics” and Protectionism: A significant return to high tariffs and trade barriers is expected, with proposed US tariffs (up to 60% on China) threatening to trigger global trade wars and “decoupling”.
- Subdued Global Growth: GDP growth is projected to slow to approximately 2.3%–2.9% in 2025, down from the pre-pandemic average of 3.2%.
- Fiscal Imbalances & Debt: Global public debt-to-GDP is estimated at 90% for 2025, with many developing nations facing “lost decade” risks due to high debt-servicing costs.
- AI as an Economic Engine: AI is expected to substitute for mental capacity rather than physical labor, potentially improving income inequality within countries by challenging skilled-worker dominance.
- Green Transition Retreat: Some governments are retreating from climate policies as economic insecurity forces a prioritization of immediate energy security over long-term sustainability goals
