Issue Deepening geopolitical fragmentation and a new wave of protectionism

Summary

The report lists deepening geopolitical fragmentation and the spread of a new protectionism as the first global issue for 2026. Rivalry between the US and China, the war in Ukraine and conflict in the Middle East are splitting the world economic order into blocs and weakening interdependence. As trade barriers rise, global supply chains are expected to be reorganised or severed faster, while security-related industries such as defence are forecast to grow. The report argues that Korea needs tailored trade strategies toward major partners including the US and the EU. It also calls for more budget support for exporters and expanded strategic research and personnel exchanges with leading AI and semiconductor countries.