Tariffs and AI’s downside pose top global risks for business, World Economic Forum saysAdrian LoweCNBCThu, 15 January 2026 10:19AMEmail Adrian Lowe
Global power rivalries and strategic standoffs top the list of most severe near-term risks heading into 2026, according to the World Economic Forum’s latest Global Risks Report released Wednesday, US time.
Half of the business executives and other leaders surveyed said they expect turbulent times over the next two years, and only one per cent said they expect calm, according to the report. The resulting picture is one of the world “sitting on a precipice.”
The report, which surveyed 1300 leaders in government, business and other organizations, captures a shifting landscape where “geoeconomic confrontation” leaps to the top spot on the list of business worries over the next two years — fuelled by increasing competition and weaponizing economic tools like tariffs, regulations, supply chains and capital constraints. The report warns it could lead to a substantial contraction in global trade.
“It’s very much about state-based armed conflict and the concerns around that. So overall, nearly a third of our respondents are very concerned in 2026 about what that means for the global economy and essentially the state of the world,” WEF Managing Director Saadia Zahidi, told CNBC’s Squawk Box Europe on Wednesday.
Worries about economic risks over the next two years have experienced the sharpest rises among all the categories of risk WEF surveys, according to the report.
“Concerns [are] growing over an economic downturn, rising inflation and potential asset bubbles as countries face high debt burdens and volatile markets,” Ms Zahidi wrote in the report.
The world’s largest insurance brokerage, Marsh — which rebranded Wednesday from Marsh McLennan — partners with the WEF on global risks.
“Today is not a moment of a big global crisis, it’s a moment of poly-crises,” Marsh chief executive John Doyle told CNBC in an exclusive interview.
Mr Doyle listed trade wars, culture wars, rapid technological revolution and the impact of extreme weather as among the current hurdles for business.
“It’s a lot for businesses to confront and to manage,” he said.
Misinformation and disinformation rank second on the WEF’s list of short-term risks, followed by societal polarization — or widening gaps between sharply opposed groups of people. Inequality is identified as the topmost interconnected risk over the next 10 years.
All of it creates impediments to the kind of cooperation necessary to address economic shocks, the report concludes.
The issue that has soared higher and faster than any other in the survey is the potential for adverse outcomes of artificial intelligence, moving from 30th place among short-term risks as of last year to fifth place among long-term risks in the most recent rankings.
Labor displacement, for instance, could lead to massive increases in income inequality, greater societal divides, contraction in consumer spending and vicious cycles of economic contraction and social discontent against a backdrop of massive productivity gains, according to the WEF report.
Machine learning and quantum computing are converging, and their development is accelerating, the report notes, warning of a supercharged landscape which “may lead to situations in which humans lose control.”
While it’s “very clear” that environmental risks have been “deprioritized” in the shorter term, according to Ms Zahidi, extreme weather remains the top concern among surveyed leaders for the next decade.
Global insured losses from natural catastrophes are estimated to reach $US107 billion in 2025, topping $US100b for the sixth consecutive year, a steep increase from even the early 2000s.
Mr Doyle said the wildfires in California in early 2025 illustrate the need for regulation that would allow insurance rates to accurately reflect the underlying risk in order to attract more capital to the insurance marketplace.
“There are risk takers. There are investors and insurance companies that are willing to finance these risks,” Doyle said. “It’s also making sure that building codes are appropriate, that we learn from prior events and that the technologies are deployed so that the risk can be managed effectively.”
The report warns: “Extreme heat, drought, wildfires and other extreme weather events are likely to become more intense and frequent.”
Yet environmental risks such as “critical changes to Earth systems” … “biodiversity loss and ecosystem collapse” and pollution have moved significantly lower on the risk list — reflecting a change in what worries leaders most.
While leaders are “highly distracted” by shorter-term concerns around “wars that don’t end,” and other issues such as inflation and misinformation, ongoing worries about sustainability continue, Ms Zahidi told CNBC. “That big looming existential risk around climate is still there. But our collective capacity and mind share … to act on it, that’s what’s been reduced,” she said.
The report concludes “coalitions of the willing” are crucial, that collaborations among governments, academic institutions, business and private citizens are essential to fostering resilience and creating workable solutions to the greatest global challenges.
But Ms Zahidi said that a “retreat from multilateralism” and a “new age of competition” are creating much concern, because risks like climate change and future pandemics need co-operation.
“Will we be able to work together when we need to?” she told CNBC.
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