Geopolitics, Tariffs, and Technology: How CEOs Are Redefining Global Strategy

How CEOs Are Recalibrating Global Strategy Amid Geopolitics and Trade Wars

For U.S.-based multinationals, the domestic market remains a cornerstone—providing unmatched access to capital, technology, and innovation. Yet the greater strategic challenge lies overseas.

China, once the centerpiece of global growth strategies, is now burdened with tariffs, export controls, and political headwinds. Executives must ask: Can American firms still compete in China without disproportionate risk?

Meanwhile, India’s rapid rise and the collective potential of ASEAN economies offer compelling alternatives. India alone cannot match China’s scale, but together with ASEAN it could equal half of China’s market within a decade. The question for CEOs is no longer whether to diversify, but how quickly to pivot footprints toward new growth corridors while managing geopolitical risk.

Protectionism, Inflation, and Instability

Throughout history, protectionist policies have fueled inflation and slower growth, often destabilizing emerging markets. Inflation is already biting in Latin America, with food prices spiking amid extreme weather. CEOs must recognize that the ripple effects of tariffs are not confined to trade costs—they can trigger broader economic turbulence.

We are entering an era of political economy, where business and politics are inseparable. Executives must cultivate the ability to manage both dimensions simultaneously. Closer engagement with governments is no longer optional—it’s a competitive necessity.

The Gray Rhinos—and Beyond

Boards often focus on what one executive called the three “gray rhinos”—U.S.–China competition, U.S.-India Tariff War, Russia’s invasion of Ukraine, and conflicts in the Middle East. These are known risks with medium-to-high impact.

But localized tensions, from border disputes to resource conflicts, can disproportionately disrupt operations if companies hold significant capital exposure in those regions. CEOs must build monitoring systems that flag not only global flashpoints but also localized risks with strategic impact.

Beyond Tariffs: Geoeconomic Chessboard

Tariffs dominate headlines, but other geoeconomic dynamics are equally critical:

• Export controls restricting access to chips and high-end technology.
• Dollar trajectory influencing global capital flows.
• Energy security concerns reshaping trade alliances.
• Critical infrastructure tensions affecting logistics and data flows.

Boards need frameworks to oversee these risks, supported by institutional capacity to monitor, model, and respond to emerging flashpoints.

Tariff Shock: What a 50% Duty on Indian Goods Means for U.S. Firms

The U.S. decision to impose a 50% tariff on Indian goods is set to ripple across industries, and ironically, American companies may feel much of the pain. While designed to protect domestic industries, the measure could drive up costs, disrupt supply chains, and erode competitiveness for U.S. firms.

• Supply Chains and Input Costs:
  Many U.S. companies source critical inputs from India—textiles, automotive components, pharmaceuticals, and IT services. A 50% tariff inflates costs, squeezes margins, and forces companies either to absorb losses or pass higher prices to consumers. For sectors like pharmaceuticals, where India is a leading producer of generics and active pharmaceutical ingredients (APIs), the tariff could raise U.S. healthcare costs.
• Consumer Prices and Inflation:
  Indian textiles, apparel, and auto parts flow heavily into U.S. markets. Tariffs on these imports will increase retail prices, adding to already high inflationary pressures.
• Strategic Risks:
  For multinationals, the tariffs create uncertainty around India as a growth market. With U.S.–India trade worth over $120 billion annually, restricting access risks undermining American firms looking to expand into India’s fast-growing economy.

Risk Management Gaps

The gulf between top-performing firms and laggards in risk management is widening. The best multinationals:

• Build geopolitical scenarios and model economic impacts.
• Prepare mitigations and event triggers in advance.
• Apply concentration limits to supply chains, similar to banks’ exposure caps on loan books.

Others remain reactive, leaving themselves vulnerable to sudden shocks. For CEOs, treating concentration risk in supply chains like financial risk is now a board-level priority.

Geopolitics, Technology, and AI Converge

Geopolitics can no longer be separated from technology. Competition is increasingly about national security, economic independence, and technological leadership. Many governments are moving toward sovereign AI ecosystems and sovereign cloud systems, reshaping where and how global firms can operate.

For executives, the convergence of AI, national security, and economic policy means technology strategy is inseparable from geopolitical strategy.

Executive Takeaway

For today’s C-Suite, geopolitics, geoeconomics, and technology are converging into one strategic domain.

• China is higher risk, but remains indispensable; India and ASEAN are critical hedges.
• Protectionism fuels inflation and instability, requiring vigilance across emerging markets.
• Boards need frameworks to oversee risks beyond tariffs, from export controls to critical infrastructure.
• Risk management must mature, with concentration limits and scenario planning built into corporate DNA.
• Technology is geopolitical. CEOs must integrate AI, cloud, and digital sovereignty into their global strategy.

The new corporate question is not whether multinationals can stay global, but how—and at what level of resilience.

Have you read?
The Citizenship by Investment (CBI) Index evaluates the performance of the 11 nations currently offering operational Citizenship By Investment (CBI) programs: St Kitts and Nevis (Saint Kitts and Nevis), Dominica, Grenada, Saint Lucia (St. Lucia), Antigua & Barbuda, Nauru, Vanuatu, Türkiye (Turkey), São Tomé and Príncipe, Jordan, and Egypt.