For much of our careers, many of us operated in a world of deepening globalization. Trade was expanding, inflation felt under control, and security wasn’t at the top of our agenda. That world has changed. And while some of us may have hoped things would simply return to “normal,” it’s clear we’re in a very different environment now. That’s why geopolitics has become such a central management and leadership issue: it requires all of us to adapt, to rethink assumptions, and to lead differently.
At this year’s IMD Alumni Symposium in Lausanne, I had the opportunity to discuss what this new world order means for the global economy and business leaders with Børge Brende, President and CEO of the World Economic Forum.
“The highest tariff in the world, in my view, is unpredictability.”
“The highest tariff, in my view, in the world is unpredictability,” said Brende, noting, however, that despite intensifying geopolitical turmoil, the global economy has proven remarkably resilient. A year ago, much of the debate centered on whether the US would face a soft or hard landing, he said. Yet, there has been no landing at all; the economy continues to grow robustly.
While the US represents 25–30% of global GDP, it accounts for an astonishing 70% of the total market capitalization of listed companies worldwide, said Brende. This reflects the extraordinary financial muscle of the US, which this year alone is channeling roughly $500 billion into artificial intelligence, as well as the ability of its companies to access capitalize and utilize cash flows for investments. Although many of these AI companies have yet to generate returns, the scale of investment underscores America’s dominance in innovation and finance.
In Brende’s view, these new transformative technologies are driving productivity gains that may have shielded the economy, though progress won’t be linear. Risks are mounting and as with past bubbles – most famously the dotcom bubble of the early 2000s – there are concerns around overvaluation in areas like crypto and AI.
Still, Brende noted that even bubbles can accelerate lasting transformation, just as the dotcom era paved the way for today’s digital economy.
Going further back in time, the move from agriculture (where 97% of the Swiss population worked 100 years ago versus 2% today producing triple the food), show how economies can radically transform. Success depends on adapting, otherwise, nations risk decline, as seen in Argentina.
While the US is still an economic powerhouse – accounting for 30% of the global economy with just 5% of the global population – it is no longer willing to be the global policeman. As Brende noted: “The US is still a superpower, but maybe a superpower without superpowers” with Afghanistan showing the limits and risks of war.
Brende expressed optimism about Europe’s prospects. “Those who write off Europe are making a mistake. Europe has an ability to bounce back,” he said, highlighting Spain’s position as the fastest-growing OECD economy and Europe’s status as the world’s second-largest exporter of manufactured goods after China.
He observed that while Europe typically responds best under pressure, the region holds significant potential if it pursues a capital markets union and implements the reforms proposed by Mario Draghi.
A major risk, however, is the rise of populism. Europe must determine how to uphold its values while managing immigration challenges, Brende said.
Brende believes we are in an “AI arms race” with those who succeed in leading developments in AI, fusion, and biotech directly increasing their global influence and national power. A question is whether it will lead to a “winner-takes-it-all” situation, or whether the gains would be more distributed, he added. Brende is bullish that there will be more opportunities later on.
“I’m overall quite optimistic for the world moving forward. I think we’re at the start of a situation where the new technologies will be the driver of growth for decades. I think these new technologies will fuel growth and the world will be more prosperous,” he said. “You should focus your leadership on the business opportunities.”
This article is inspired by an opening session at IMD’s 2025 International Alumni Symposium in Lausanne, 3-4 October 2025.
The success of the biggest American companies and pension funds depends on international markets. Perhaps this can give the world the leverage it needs to keep the US on board for the...
Audio available
Business leaders must master the art of building strategies that take account of partisan divides over net-zero goals while progressing the interests of their company and society....
Audio available
In the final article of our series, we explore how businesses face hard planetary and geopolitical limits that make the “business as usual” growth model untenable as climate shocks, biodiversity loss, and...
The rules-based order that underpinned globalization is lurching from an open-source to a closed-source model. But even without the participation of the US, an ‘open hybrid’ system will ensure stability in the...
Audio availableExplore first person business intelligence from top minds curated for a global executive audience