Based on views shared by Country Acuity at a recent panel discussion at the Singapore Management University International Trade Institute
We can't be blamed for under estimating geopolitics. Yes survey after survey suggests that leaders and CEOs are worried about geopolitics. But it is such an amorphous topic. One other key aspect why many of us don't fully understand or appreciate the gravity of geopolitical risks or the geopolitical risks is because we have no experienced these risks in a very personal way.
A political and geopolitical super cycle is upon us following three decades of stability
Academic theory supports geopolitical volatility narrative
Most mega trends have a geopolitical and political dimension – hard to just say ‘its just politics’
Uncertainty, Risk, Resilience and Corporate Decision Making - leader's don't have the luxury to say it's just politics
Think about it.
The cold war ended some 30 years ago. That means, anyone who is 40 or 45 are younger has limited to no personal connection to the cold war.
It's been 75 years since WWII, what does that mean, folks who experiences the great war and living now are very much a minority, you'd have had to be around 80 years or older (roughly speaking) to have lived through those horrors. Perceptions and lived realities matter. The war mongering on social media these days suggests the lack of empathy for death as many have not experienced the bloodletting of wars past.
International relations theory supports what we are living through right now. We are moving from uni-polarity, where the United States was the dominant power in the international system to where power is more dispersed. Part because the US has been turning inwards and also eschewing multi-lateral ism and international order under the current Trump administration. China and other rising powers want a greater say in world affairs. This was the case back in the early 20th century when Germany, then a rising power wanted a greater say and pushed up against Great Britain. There are similarities between the rising US in the 1940s and the UK despite both countries being democracies.
We are finding out, to many economists and financial analysts chagrin, that economics don't always trump politics. What is rational and self interested behavior to avoid conflict and trade wars, can be a very rationale pursuit to someone else, especially when non-economic considerations come into the mix.
The counter argument is that technology and the globalized world has evolved and that there is no place for conflict. We should collaborate and cooperate on global issues such as climate change goes the argument. Digitization has no borders. All true and I sincerely hope this time is different, but history, shows otherwise. As Mark Twain famously quipped, "History doesn't repeat itself, but it often rhymes" and right now there is a lot that uncannily rhymes with what happened in the the early 1900s.
In such an environment where the ground underneath is shifting so to speak, its hard to sometimes see what's happened and see the forest from the trees. But as resilient business and organizational leader's this is the task. Life must go on, decisions must be made.