Global supply volatility is now a fact of life amid rising geopolitical tension, the rise of artificial intelligence and dwindling natural resources.
The finding is contained in a 2026 outlook on global supply chains just presented at the World Economic Forum in Davos, Switzerland, on Monday (Australian time).
This disruption is forcing companies and governments to re-evaluate investment strategies with 74% of business leaders said to view resilience as a driver of growth, the forum says.
> Click here to read the report in full
The forum has already been dominated by US President Donald Trump’s continual threats to annex Greenland and Canada.
“Volatility is no longer a temporary disruption; it is a structural condition leaders must plan for,” says Kiva Allgood, Managing Director of the World Economic Forum.
“Competitive advantage now comes from foresight, optionality and ecosystem co-ordination. Companies and countries that build these capabilities together will be best positioned to attract investment, secure supply and sustain growth in an increasingly fragmented global economy.”
2025 SUPPLY DISRUPTIONS
The Forum notes that in 2025, tariff escalations between the US and other major economies reshuffled more than $400 billion in global trade flows while disruptions of major shipping routes pushed container shipping costs up 40% year on year.
(For Australia, 99% of its overseas exports are by sea while 99% of its internet traffic passes via undersea cables).
It says this is a signal of a decisive move away from short-term shocks towards longer-term uncertainty at a time when manufacturing growth in advanced economies is at its weakest since 2009.
The report also highlights that in 2025, more than 3000 new trade and industrial policy measures were introduced globally, more than three times the annual level 10 years ago.
“Supply chain disruption in 2026 will be constant and structural. Geopolitical fragmentation, shifting trade rules and labour shortages are all redefining how value is created and moved,” says Per Kristian Hong, a Partner at Kearney, which co-produced the 2026 report.
“For supply leaders, the priority is no longer forecasting disruption but redesigning operating models to function under permanent uncertainty. That means moving away from efficiency-driven supply chains and towards adaptive networks that can be reconfigured with optionality as conditions change.”
MORE ABOUT …
- The outlook draws on the insights of more than 100 leaders of industry, government and academia worldwide and from survey data of more than 300 senior executives.
- The World Economic Forum’s 56th annual meeting runs from January 19-23 at Davos-Klosters, Switzerland.
