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  • > Escalating Geopolitics & Tariff Uncertainty — Why Trade Risk Is Now Revenue Risk

Escalating Geopolitics & Tariff Uncertainty — Why Trade Risk Is Now Revenue Risk

Thought Leadership 01/21/2026

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For years, companies treated tariffs and trade disputes as temporary disruptions — something to manage around while “waiting for things to normalize.”

In 2026, that assumption is no longer just wrong — it is dangerous.

Global trade growth remains weak, tariff regimes are hardening across the U.S., China, and Europe, and export controls are expanding into new industries and technologies. What were once episodic trade skirmishes have become structural features of the global economy.

This is why Escalating Geopolitics & Tariff Uncertainty sits at the top of the 2026 Global Trade Executive Agenda.

The shift most companies haven’t internalized

Many executive teams still ask:

“How do we minimize duties on our current supply chain?”

The better question in 2026 is:

“Is our current supply chain economically and geopolitically viable at all?”

Tariffs now influence:

  • Gross margins
  • Pricing strategies
  • Customer commitments
  • Sourcing decisions
  • Manufacturing footprints
  • Market entry and exit

Trade policy is no longer a downstream compliance issue. It is a first-order business variable.

From cost risk to revenue risk

What makes today’s environment so different is not just the size of tariffs — it’s their unpredictability.

Retaliatory duties, technology controls, forced-labor bans, and country-specific restrictions can appear with little warning and take effect immediately. As the Executive Agenda states, these changes are already disrupting margins, pricing strategies, sourcing choices, and customer commitments.

That means:

  • A product that was profitable last quarter may be unprofitable next quarter
  • A supplier that was compliant yesterday may be blocked tomorrow
  • A market that was open last year may suddenly become restricted

This is why trade risk is now revenue risk.

Why finance leaders are being pulled into trade

CFOs are increasingly being forced to answer questions that would have been unthinkable a decade ago:

  • What is our tariff-adjusted cost of goods by region?
  • How much margin is exposed to geopolitical escalation?
  • What happens to EBITDA if a key trade lane is disrupted?
  • Are our prices built on assumptions that no longer hold?

Without clear, data-driven answers, companies are flying blind.

What winning companies are doing differently

The Executive Agenda makes this clear: companies need multi-scenario plans, tariff-adjusted cost models, and board-approved geopolitical playbooks.

In practice, this means leading organizations are:

  • Modeling multiple tariff and sanction scenarios across supply chains
  • Building geopolitical stress-tests into sourcing and pricing decisions
  • Mapping exposure to specific countries, technologies, and materials
  • Using trade data to inform strategic planning — not just customs filings

They are no longer reacting to trade shocks.

They are planning for them.

The new executive reality

In 2026, global trade sits alongside interest rates, inflation, and currency as a core driver of enterprise value.

Ignoring geopolitics doesn’t make it go away.
Ignoring tariffs doesn’t protect your margins.
Ignoring trade risk doesn’t protect your revenue.

It simply leaves you exposed.

In the next article, we will explore Force #2: Digital Enforcement & Intensifying Compliance Scrutiny — and why governments now have more data, more technology, and more visibility into your supply chain than most companies have into their own.

This series is just getting started. We would value your perspective and hope you will consider joining this community of global trade leaders

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