Interview, Podcast
Navigating the new geopolitical and technology landscape
- Geopolitical uncertainty is projected to reach a two-decade high and persist with worsening conditions for an extended duration.
- The period of hyper-globalization is considered to have ended prior to the pandemic, replaced by a new chapter defined by competition between great powers utilizing differentiated assets like the dollar, energy, and supply chains.
- Over the next 10 years, geopolitical swing states such as Norway, Singapore, India, Indonesia, Brazil, and wealthy Gulf states are expected to exercise unique agency by pursuing multi-alignment strategies rather than aligning exclusively with a single power.
- Geopolitics is now driving economic interests, particularly among major powers, leading to an unprecedented reorientation of supply chains that will impact most businesses to some extent over the next decade.
- Competition between the U.S. and China is characterized as an asymmetric conflict with different rules and is expected to sustain for a long time, though total decoupling is deemed unfeasible and counterproductive.
- The competitive dynamic is expected to be a "competitive coexistence" rather than a winner-takes-all scenario like the Cold War, with most nations seeking a technological "cocktail" of efficient systems rather than adopting a single model.
- A significant tension exists between slow-moving government regulatory frameworks and the accelerating pace of technology, particularly artificial intelligence, which is expected to define leadership and alignment challenges over the next five to seven years.
- Large language models, which emerged around 2017, represent an accelerating rate of technological change with striking advances in AI that are already impacting consumers, companies, and nations.
- Governments risk suboptimizing efficiency and creating a "splinternet" if they pursue unitary national policies without coordinating on technology standards and money movement.
- Companies must shift from regional strategies to specific, tactical, country-by-country approaches and make bets in a more intelligent and hedged manner due to increased geopolitical complexity.
- The Office of Applied Innovation aims to provide actionable business relationships and intellectual partnerships, leveraging Goldman Sachs' expertise in controls, regulation, and finance to navigate the mismatch between national policies and borderless technology.
- Market forecasts and price references are based on data recorded as of Thursday, March 2nd, 2023, and the content does not constitute investment advice.