1 The global economy: tensions and fragmentation
International trade is being restructured along lines of geopolitical allegiance.
Macro context
Global trade under strain
The end of integrated globalization is confirmed. Trade wars are no longer tactical but systemic: the United States and its allies (EU, Japan, South Korea) on one side; a China-centered bloc on the other, with a critical mass of non-aligned countries seeking to diversify their dependencies. Tariffs swing between 15 and 40% on key goods (electronics, steel, chemicals). Supply chains, once meant to be global, are being redrawn bloc by bloc.
Imported inflation (EU)
3.8%
Tariff increases passed through to consumer prices
Global growth
2.4%
Slowdown vs 2021–2023 (3.1%)
US/Europe gap
+1.2%
AI and domestic demand support the US
EUR/USD currency volatility
±4%
ECB vs Fed divergence
Three parallel scenarios
①
Continental de-risking: Europe seeks self-sufficiency (a European CHIPS Act, green supply chains). An immediate cost but long-term resilience.
②
Retreat of dollar hegemony: China pushes the yuan in regional trade; BRICS seeks a common currency. Gradual monetary fragmentation.
③
"Stagflationary" inflation: stable energy costs but high tariffs = squeezed SME profits, widening inequality, social pressure.
Investor takeaway: Favor champions of local resilience (EU renewables, US green tech), and avoid tariff-sensitive assets (European cyclical industrials in particular).
2 US-China rivalry: when economic competition turns structural
Far beyond a trade quarrel: a redefinition of power hierarchies.
Systemic confrontation
Two diverging economic worlds
The United States is consolidating a technological alliance with the West and Japan (chip technology, AI, cybersecurity). China is building an integrated regional economy (RCEP, BRI 2.0) while challenging dollar dominance. Europe, caught in the middle, negotiates with both while seeking strategic autonomy. The critical stakes: semiconductors, rare earths, biotech, quantum computing.
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IT sector
US tech restrictions tighten. Exports of 5nm chips to China blocked.
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Manufacturing
US nearshoring (Mexico) vs Southeast Asia for China. Duplicated factories.
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Finance
Sanctions on Chinese institutions. De-risking of portfolios.
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Soft power
Geographic influence: Taiwan remains the epicenter of potential tensions.
Priority friction zones
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Taiwan and the strait: essential for 90% of advanced semiconductors. Any incident destabilizes the global economy.
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Southeast Asia: a transit route (20% of global maritime trade). China and the US court Thailand, the Philippines and Vietnam.
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Africa: mineral resources. China, the US and Europe compete for access to rare earths and lithium.
US strategy
Chip supremacy (Taiwan, South Korea)
Technological alliances (AUKUS, Quad)
Gradual decoupling
Weakness: critical metals
China strategy
Energy self-sufficiency
Regional expansion (BRI, RCEP)
Gradual de-dollarization
Weakness: unfinished diversification
3 Energy and the transition: critical bottlenecks
The energy transition runs into mineral and geopolitical realities.
Mineral resources
Lithium, cobalt, rare earths: the green economy stays dependent
To reach Net Zero 2050, lithium extraction would need to multiply sixfold, cobalt fivefold and nickel fourfold. Yet 50% of lithium comes from Chile/Argentina, 70% of cobalt from the DRC (a fragile zone), and 97% of rare earths are processed in China. The energy transition is becoming a geopolitical battle for control of these minerals. Prices swing wildly: lithium +300% since 2020, then a partial collapse, creating mining bubbles.
Lithium demand (2030)
+550%
vs 2020 — electric batteries
Green-energy cost
−45%
Since 2015, but asymmetric capital investment
China concentration (rare earths)
97%
of global rare-earth processing
Cost to reshape supply
€50B
Europe (10 years) to reduce dependency
The energy transition no longer depends solely on technology or financing, but on geopolitical control of mineral extraction and refining chains.
Three energy fronts
①
Electrification: electric vehicles and battery storage consume resources the world has never processed at this scale.
②
Green hydrogen: an emerging technology, costly to produce, with energy efficiency still compromised.
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Energy security: Europe is exiting Russian gas but grows more dependent on volatile LNG imports (Qatar, US, Australia).
4 Technology: AI redraws the balance of power
Beyond data: control of processors, model training and standards.
Computational revolution
Generative AI becomes a geopolitical weapon
AI demands colossal computing power. Nvidia dominates 80% of the GPU market (the processors for AI). The US controls 90% of the chain (design, with manufacturing in Taiwan). China invests massively but stays hamstrung by tech sanctions. Europe arrives late to the race. Controlling computing power = controlling critical applications (defense, biology, finance). The stakes: advanced semiconductors (3–5nm), electricity for data centers, and the world's research talent.
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Military AI
Autonomous weapons, cyber-defense, reconnaissance. A race between powers.
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Power and data
Data centers consume 2-3% of global energy. Friction with the green transition.
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Cybersecurity
State attacks on critical infrastructure (energy, finance, health).
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Tech standards
The US and China set 5G, cloud and quantum standards. A geopolitical edge.
Three critical technology fronts
①
Semiconductors: Taiwan = 85% of advanced chips. A single plant failure = a global crisis. TSMC and Samsung must decentralize (US, South Korea).
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Quantum computing: a technological break in progress. Whoever masters it will crack today's encryption. An active race between the US, China and Europe.
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Digital standards: generative AI, blockchain, interoperability. Whoever sets the standards controls the value chain.
5 Implications for portfolios
How geopolitical tensions are reshaping asset allocation.
Five principles for adapting
①
Resilience > pure yield: favor sectors less exposed to tariffs (health, infrastructure, defensive consumption) over cyclical industrials.
②
Intentional geographic diversification: avoid over-concentrating in a single geopolitical bloc. Seek assets from non-aligned countries (Canada, Switzerland, Australia).
③
Energy transition = a long-term opportunity: mineral bottlenecks are temporary. Value the champions of the green chain (batteries, panels, smart grids).
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Technology = dependency: AI and semiconductors are challenges, not cure-alls. Overweighting tech without a de-risking strategy = risk.
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Accelerated currency volatility: a weaker dollar long term, but with tactical rebounds. Hedge positions in euros/yen depending on exposure.
Favor
Green energy + batteries
Pharma and biotech (resilience)
Defense and aerospace
Infrastructure (toll roads, water, power)
Decentralized finance (hedge)
Reduce / avoid
European cyclicals exposed to tariffs
Chinese tech (sanctions risk)
Single-thread supply chains
Oil importers (volatility)
Assets with no geopolitical hedge
📊 Geopolitical adjustment test
For each position, ask: (1) Am I exposed to tariffs? (2) Do I depend on controlled minerals or semiconductors? (3) Does my value chain run through tension zones (Taiwan, the strait, Southeast Asia)? If yes to 2+ questions, reduce or hedge. A resilient portfolio does not ignore geopolitics, it integrates them.