Unlocking Growth: Going Global

Navigating Global Shifts

Global trade patterns are undergoing profound changes. In 2025, US tariffs surged to an average of 17%, up from under 3% in recent decades. This shift stems from heightened nationalism and security concerns, prompting firms to rethink supply chains. Companies now face pressure to regionalize operations, diversifying suppliers to mitigate risks from concentrated dependencies, particularly on China. Emerging markets in South Asia and the Middle East offer brighter prospects, with projected growth exceeding 6% in some cases, driven by infrastructure and demographics.

The stakes are concrete. Establishing a legal entity abroad can cost $75,000 to $150,000 in the first year, with timelines varying from weeks in digitally advanced nations like Estonia to months in bureaucratic ones like Germany. Inaction carries steeper penalties: firms locked into tariff-hit imports could see costs rise 20-30%, squeezing margins. Geopolitical flashpoints, such as ongoing conflicts in Ukraine and potential escalations elsewhere, amplify these risks, potentially disrupting $10.9 trillion in annual cyber-related losses if defenses falter.

Less obvious tensions lurk beneath. While deglobalization aims to bolster domestic resilience, it clashes with the imperatives of AI adoption, where advanced economies are poised to double productivity gains over lower-income ones. This creates a zero-sum dynamic, as emerging nations struggle to reduce reliance on tech superpowers. In Scotland, recent research underscores a gender export gap, where female entrepreneurs face unique barriers to going global, exacerbating inequalities in a landscape already strained by policy uncertainty.

Trade reallocations add another layer. Capital expenditure decisions now prioritize geopolitical insulation, with multinationals shifting $0.8 to $1.2 trillion in flows toward resilient hubs like India by 2030. Yet, this comes at a price: higher borrowing costs in advanced economies could slow overall global GDP to 3.1% in 2026, vulnerable to shocks from public debt or market corrections.