GENEVA, June 23, 2026 — The world faces an increasingly turbulent future as geoeconomic confrontation emerges as the top global risk for 2026, according to the World Economic Forum's Global Risks Report 2026. The report, published in January but increasingly relevant as the year unfolds, finds that economic risks are rising fastest in the short term, with downturn and inflation both surging eight positions year-on-year.

The outlook from leaders and experts shows deep concern. Half of those surveyed anticipate a turbulent or stormy world over the next two years, up 14 percentage points from last year. A further 40% expect the two-year outlook to be unsettled at the very least, while 9% expect stability and 1% predict calm. When it comes to the outlook for the next 10 years, 57% expect a turbulent or stormy world, 32% expect things to be unsettled, 10% predict stability and 1% anticipate calm.

The Top Risks for 2026

The Global Risks Report 2026 identifies the following as the top risks for the year:

1. Geoeconomic confrontation — 18% of respondents view it as the risk most likely to trigger a global crisis in 2026, ranked 1st for severity over the next two years, up eight positions from last year
2. State-based armed conflict — Follows in 2nd position for 2026, dropping to 5th position in the two-year timeframe
3. Extreme weather — Ranked 3rd, reflecting growing concerns about climate change impacts
4. Societal polarization — Ranked 4th, highlighting divisions within and between societies
5. Misinformation and disinformation — Ranked 5th, underscoring concerns about the integrity of information ecosystems

A Multipolar and Fragmented World

In a world of rising rivalries and prolonged conflicts, confrontation threatens supply chains and broader global economic stability as well as the cooperative capacity required to address economic shocks. When it comes to the geopolitical outlook, 68% of respondents expect a "multipolar or fragmented order" over the next decade, up four points from last year.

This shift towards multipolarity has profound implications for international cooperation. In a fragmented world, building consensus on global challenges—from climate change to pandemic preparedness to financial stability—becomes exponentially more difficult. The report warns that as immediate risks intensify, longer-term challenges from technological acceleration to environmental decline are also creating knock-on effects.

USMCA Uncertainty and Trade Tensions

The EY Geostrategic Analysis for June 2026 highlights several key geopolitical risks, including uncertainty over the USMCA extension. The USMCA free trade agreement is scheduled for its six-year review, and if the parties do not agree to extend the agreement by July 1, the agreement remains in place until July 2036 and an annual review process will be initiated.

The US is seeking to renegotiate a number of commitments including select rules of origin, agriculture market access, digital services, improved enforcement of forced labor import bans, and transshipment of Chinese exports. Non-trade issues such as national security spending, border security, and the development of critical minerals capabilities are also likely to feature in negotiations.

Mexico and Canada are seeking greater stability in the trading relationship and more favorable treatment from US unilateral tariffs. The lack of a clear path toward USMCA renewal and under what terms it may proceed are creating heightened levels of uncertainty.

EU's Tech Sovereignty Push

Another significant development is the EU's gradual move toward more tech and data sovereignty. On June 3, 2026, the European Commission announced a series of legislative proposals and strategic roadmaps as part of a "Tech Sovereignty Package" including the Cloud and AI Development Act and the Chips Act 2, aimed at strengthening domestic digital capabilities and reducing reliance on non-EU providers across cloud, semiconductors, and digital infrastructure.

The initiative aims to triple EU data centers capacity in the next five-to-seven years. This comes against a backdrop of heightened political concern across EU Member States—including, most notably, France—regarding Europe's lack of technology sovereignty, as more than 80% of key digital products, services, and infrastructure are sourced externally.

G7 Divergences

The G7 summit held on June 15-17, 2026 in France was likely to manage rather than resolve divergences among the members. Canada aligned more closely with European members at the G7, following Canada's participation at the European Political Community summit on May 4, 2026—the first inclusion of a non-European country—which signaled a hedging response to rising US policy uncertainty and tariff pressure.

The G7 summit tested whether transatlantic partners could reach common ground on key issues, particularly trade and AI governance. However, widening divergences—on relations with China, NATO commitments and support for Ukraine, and the conflict in the Middle East—constrained alignment. As a result, the June G7 primarily tried to manage internal divisions rather than drive unified outcomes.

Critical Raw Materials Restrictions

A major global trend identified in the EY analysis is the rising export restrictions on critical raw materials. The number of export restrictions on critical raw materials has increased fivefold since 2009 and remains at historically elevated levels, according to a recent OECD report. Export taxes and licensing requirements remain the most widely used instruments, while more severe measures—such as export prohibitions—are also emerging, accounting for nearly a quarter of new restrictions in 2024.

While such measures often aim to promote domestic processing, protect the environment, attract investment, and generate revenue, restrictions—particularly those imposed by major producers—can generate significant spillovers for trading partners and trigger similar measures by other countries, driving price escalation and tightening global supply.

Asia-Pacific Energy Security

In response to global instability, Asia-Pacific middle powers are exploring closer energy security coordination. Japan's Defense Minister Shinjiro Koizumi met with his counterpart Ahn Gyu-back in South Korea in June to discuss expanding defense cooperation. The meeting built on the themes laid out in the May 2026 summit in South Korea between the two countries' leaders, which focused on strengthening strategic cooperation, especially around energy security.

Energy security is also top of the agenda in Southeast Asia. At the May 2026 ASEAN summit, leaders framed the conflict in the Middle East as a driver for accelerating practical energy security cooperation measures, such as fuel-sharing and joint power grid initiatives. This momentum may expand into more institutionalized regional mechanisms, cross-border infrastructure investment, and accelerated regional trade agreement processes.

The Road Ahead

As 2026 unfolds, the world faces a complex web of interconnected risks. Geoeconomic confrontation, state-based armed conflict, extreme weather, societal polarization, and misinformation are not isolated challenges but mutually reinforcing threats that demand coordinated responses.

The shift towards a multipolar and fragmented order makes international cooperation more difficult but also more necessary. How nations navigate these challenges will determine whether the world can avoid the turbulent future that half of surveyed experts anticipate, or whether the storms ahead will be even more severe than currently predicted.