As politicians and business leaders head to the Swiss ski resort of Davos there are new warnings around the fragility of the world’s supply chains.

As the World Economic Forum opened yesterday, a new report has said global supply chains have entered an era of structural volatility. This volatility has forced companies and governments to reevaluate how and where they invest and produce. The report added that nearly three in four business leaders now prioritise resilience investments, with 74% viewing resilience as a driver of growth.

Set against a backdrop of geopolitical fragmentation, accelerating technological change and mounting resource constraints, the report – Global Value Chains Outlook 2026: Orchestrating Corporate and National Agility – developed in collaboration with Kearney, examined how companies and governments can remain competitive as disruption becomes a permanent feature rather than a cyclical shock.

“Volatility is no longer a temporary disruption; it is a structural condition leaders must plan for,” said Kiva Allgood, managing director, World Economic Forum. “Competitive advantage now comes from foresight, optionality and ecosystem coordination. Companies and countries that build these capabilities together will be best positioned to attract investment, secure supply and sustain growth in an increasingly fragmented global economy.”

The WEF said the scale of the shift is already evident. Last year, tariff escalations between major economies rerouted more than $400 billion in global trade flows, while disruptions across major shipping routes pushed container shipping costs up 40% year on year, signalling a decisive move away from short-term shocks towards enduring uncertainty.

At the same time, manufacturing output across advanced economies is growing at its weakest pace since 2009, while more than 3,000 new trade and industrial policy measures were introduced globally in 2025 alone – more than three times the annual level recorded a decade ago. Together, these forces underscore why supply chain resilience has become a central determinant of national competitiveness and corporate strategy.

The report also highlighted how targeted national approaches are already shaping manufacturing competitiveness. For example in Ireland, enterprise-led upskilling through Skillnet Ireland links government, business and educators to deliver subsidised training aligned with industry needs. In China, large-scale investment in digital infrastructure under the New Infrastructure initiative has enabled real-time industrial connectivity through widespread 5G deployment. In Qatar, a national dashboard tracking essential food items in real time strengthens supply security by enabling early intervention, buffer stocks and rapid, data-driven responses to disruption.

“Supply chain disruption in 2026 will be constant and structural. Geopolitical fragmentation, shifting trade rules and labour shortages are all redefining how value is created and moved,” explained Per Kristian Hong, partner, Kearney. “For supply leaders, the priority is no longer forecasting disruption but redesigning operating models to function under permanent uncertainty. That means moving away from efficiency-driven supply chains and towards adaptive networks that can be reconfigured with optionality as conditions change.”