Analysis - Appraisal - Advisory
We help companies prepare for the impact of geo-political developments on their business.Environmental Scanning
Risk and Opportunity Appraisal
Contingency Planning
Future-proofingClick Here for More...
What We Do
Pandemics, Climate Change, Geopolitical tensions, Trade Agreements, BRI, China's tech crackdown, EU data regulations are examples of global developments that affect your business. You may not have control over these events, but you can be strategically prepared.For example:
- Are your markets and customers growing securely? What are the risks?
- Are your sources of supply and supply chains adaptable, resilient and able to withstand shocks?
- Are your cross-border investments, acquisitions and alliances exposed to country risk?We help you monitor developments, assess implications for your business, and formulate strategy. Our work supports your ongoing strategy formulation.What we do not do: as a strategy boutique, we do not offer trading advice, tactical advice, financial advice, and are not involved in government relations and lobbying.
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Who Is It For?
Companies with business activities in more than one country, and specifically, managers whose responsibility spans multiple countries.
These companies and managers face a degree of complexity that does not exist in single-country businesses.
We help you monitor trends and prepare for events and issues that will affect your company strategy.
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How We Do It
We help you monitor and manage policy changes that affect your strategy. We do this through:
- Monitoring: We keep our ear to the ground for developments that will affect strategy;
- Briefs: We prepare short notes on developing topics to help you respond to developments in the market.
- Analysis: our reports assess the potential impact of global developments on business strategy;
- Our Roundtables of global executives meet to discuss global issues;
- Custom Advisory Services that examine the impact of developments on your business;
- Facilitated Strategy Sessions where senior executives from your company formulate a strategy in response to global developments;
- Briefings: talk to us about topics of interest that your managers need to learn about fast.
- Training: teaching managers how to think strategically about global issues.
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Our Worldview
We do not take a political stand. Our foundational beliefs include the following:
- Trade is beneficial: not just in a Ricardian sense, but in terms of human progress and well-being. Some of the greatest cities, cultures, and human achievements came about at the crossroads of trade routes.
- Globalization has created tremendous wealth and can continue to do so;
- Corporations and business are vehicles for trade and globalization;
- Knowledge and insight help companies survive and thrive in the 21st century.
Our Conversations with ExpertsWatch our conversations with experts from around the world.
We dig into the issues faced by senior executives as well as perspective and analysis provided by academic and thought leaders.
Available to members.Click here to inquire about membership.
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Conversations Around UsWe keep an eye out for conversations about ideas that impact global strategy. Watch and listen some of these conversations here.
Why every company needs a foreign policy, a panel discussion from the World Economic Forum at Davos 2018.
Ian Bremmer discusses his 2021 Foreign Affairs article on Big Tech's challenge to the Global Order.
A Podcastfrom Chatham House on Great Power relations. Francis Fukuyama and Hongying Wang.
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RoundtableEvery month our roundtables of global executives meet to discuss the impact of geo-strategic developments. Our goals are to put recent developments into long terms context, to share ideas on impact and response, and to poll expectations of future development. The roundtable format offers executives to share perspectives and compare notes with global peers.Click here to learn more about membership.
AnalysisOur reports assess the expected impact of global developments on business strategy.Reports are accessible to members.A recent sample report summary on the fine chemical industry entitled "Emerging into a Post Pandemic World" is available on request.Click here to inquire about membership.____________________
What we are readingArticles, ideas, concepts and tools from around the web that are helpful in making sense of geo-strategic developments..
The De-Dollarization Debate
The de-dollarization debate has been raging in newspapers, on Twitter, and in conferences and other forums.
In a recent note and FT article, Zoltan Pozsar makes the case that the dollar's days are limited, and that within the medium term we are going to see a significant drop in the use of the dollar in global trade as well as in the vaults of central banks. He points to the fact that there has already been a drop of about 10 percentage points in dollar denominated reserves this century, and then to the fact that China and Arab countries have agreed to conduct energy trade in Yuan as evidence that the dollar will no longer be central to trade.
On the other side of the debate, economists such as Brad Setser and Michael Pettis argue that there is little chance of the dollar being replced as long as the United States is the only country with the ability and willingness to absorb capital surpluses.
This continues to be a fascinating debate that we are watching closely because of its implications for corporate strategy.
Yes, the Thucydides Trap
The Thucydides trap is real, the great powers are indeed falling into it.
There are ways of averting war during power transitions, but...
This is a good summary of the current debate on whether great power competition in Asia is falling into the Thucydides Trap. Click on picture to go to the Hague Centre for Strategic Studies page where you can download the pdf.
Trade, Even in Turbulent Times
In preparation for a recent conversation with the author Filip Abraham, we read this piece. Trade between Europe and China is key, and must be continued, especially in turbulent times. This article appeared a while back, but its logic is sound, perhaps even more so, post Russian invasion of Ukraine.Click here to read the brief piece.
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The Strategic Challenges of Decoupling
This article in the Harvard Business Review is a helpful American corporate perspective on the implications of China's industrial policy on the tough options it has created for foreign firms in key sectors.
The picture they paint is bleak: forego intellectual property, and then compete for domestic business in China against local champions favored by the government, as they become string enough to compete on the global stage. At times the article reads like a rationale for exiting China, a kind of decoupling at the level of the company.
With its immediate decision focus, the article is short on historical context, for example, China's rationale for its Industrial Policy; as well as global context. For example, many countries from Brazil to India have attempted to build local champions in key industries, and to press import substitution, for decades -- what makes China's policy so effective where others have struggled?
Finally, the article also seems to suggest that the problems of doing business in China (for example, intellectual property theft) are unique to China. But the example they use -- that of an engineer for a competitor being bribed to hand over source code, is unfortunately all too common in the United States too, as Goldman Sachs and Google.Click here for Full Article
Great Power Competition
Just about every foreign policy expert has weighed in on Great Power Competition, but the lucidity and absence of hubris expressed by Fmr Ambassador Chas Freeman is always refreshing, always insightful. Here, speaking at the Watson Institute, Brown University in conversation with Tyler Jost and Edward Steinman (also immensely insightful). It is a fascinating discussion throughout but the first 36 minutes are essential.
Leadership in a Multipolar World
Many of the assumptions of the unipolar world that managers and companies took for granted over the past three decades are being challenged in a rapidly changing world. Horacio Falcao and Marc Le Menestrel of INSEAD describe the challenges, the folly of clinging to unipolarity, and ways of adapting to new realities, even if unpalatable to some. This is one of the early managerial pieces to take a multipolar perspective, in what is likely to become a more common theme in the coming years.Read the fascinating piece here..
The Effectiveness of Russia Sanctions
The West has imposed a stringent financial blockade on Russia designed to collapse the country's economy. How effective will these sanctions be? Forty percent of Bank of Russia's reserves are still in Dollars and Euros. The bank raised interest rates to 20% this week and boosted liquidity in response to the shock of sanctions. Things are grim. But the country has options.Adam Tooze breaks down the impact.
In summary: Russia's fiscal rectitude and conservative monetary policy in recent years give it options to buffer the shock of being isolated from the global financial system in the short term. Indeed, that isolation gives Russian monetary policy more room to be independent, with local borrowing, full control over the local currency, and little need for accountability to the global system, including ratings agencies and lenders.
Russia Central Bank's Reserves:
Exposure to Russia
Which countries are most exposed to trade with Russia, and therefore likely to feel the effects of the sanctions?Over one-third of Russia's imports come from the EU and more than 40% of its exports go to the EU .The EU has increasingly relied on Russia for its energy needs. It uses about 6 million barrels of Russian energy every day.Although energy is currently exempted from sanctions, this could change if the situation worsens, or if infrastructure in the Ukraine is imperiled.More here
Russia Imports from:
Russia Exports to:
The Double-Edged Sword of Sanctions
Are sanctions effective? They were effective in bringing Iran to the negotiating table, but they fall short in most (many?) cases. With the rise of China as the dominant trading nation, and the emergence of alternatives to the dollar, sanctions are not as effective as they used to be. They also have severe effects on the innocent citizens of the sanctioned nation that are difficult to justify.The longer sanctions are in place, the less effective they appear to be, as seen in Cuba and North Korea.Imposing sanctions on Russia also serves to push the country to further boost its trade with Asian countries which are unlikely to adhere to sanctions.Click here for the article in World Finance.
Fortune 500 Companies Climate Targets
A 2017 report by CDP in partnership with the Climate Accountability Institute found that just 100 companies accounted for 71% of the world's greenhouse gas emissions since 1988.
This recent chart from the Visual Capitalist captures the Climate targets of the Fortune 500 companies over the next three decades. Of the 500, 163 have formal climate targets. Within these targets, the chat indicates when the companies expect to be carbon neutral, when they expect to be powered 100% by renewable energy, and when their targets will be aligned with a 2 degree Celsius warming goal.
Trade Data in Perspective
A recent set of graphs from Anders Sundell puts trade data in perspective.
Plotting trade networks, these graphs show how in the year 2000, Germany and France anchored the European trading bloc, while the United States dominated the Americaas as well as the rest of the world. By 2020, the picture is changed. China is now the largest trading partner of the largest number of countries. The United States is the primary partner of many countries in the Americas, but its dominant trading relationship, like that of many countries in the world, is now with China.
Central Bank Digital Currencies: The Digital Yuan
What is at stake with the introduction of the Central Bank Digital Currency, the Digital Yuan, tested during the winter Olympics?
This is the most thorough examination of the implications.Click on the picture to go to the original report on the Carnegie India site.
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