Geoeconomic confrontation has surged to the top of the world’s risk register for 2026, as rising rivalry between major powers, economic instability and technological anxiety overshadow environmental concerns in the near term, according to the latest global risk report by the World Economic Forum (WEF).
Half of the 1,300 experts and leaders surveyed expect the world to be “turbulent or stormy” over the next two years – up sharply from last year. Only 1 per cent anticipate a period of calm in a year that has already seen the United States extract Venezuela’s president and threaten to take over Greenland, a violent uprising in Iran, and no sign to the end of the Ukraine-Russia war.
At the heart of this anxiety is a new age of competition as economic tensions between the US and China build. Geoeconomic confrontation – the use of trade, investment, sanctions and industrial policy as strategic weapons – has climbed eight places to become the number one risk most likely to trigger a global crisis in 2026. It is also ranked the most severe risk over the next two years.
State-based armed conflict follows closely behind, reflecting a world shaped by prolonged wars, fragile ceasefires and rising defence spending. Together, these risks threaten supply chains, global growth and the cooperation needed to address shared challenges such as climate change and biodiversity loss, the report said.
Geoeconomic confrontation and misinformation top WEF’s ranking of short-tern global risks for 2026. Extreme weather events rank as the top long-term risk [click to enlarge]. Source: WEF Global Risk Report 2026
“A new competitive order is taking shape as major powers seek to secure their spheres of interest,” said Børge Brende, president and chief executive of the World Economic Forum in a statement on Wednesday. “This shifting landscape, where cooperation looks markedly different than it did yesterday, reflects a pragmatic reality: collaborative approaches and the spirit of dialogue remain essential.”
Economic shocks rise fastest
Economic risks are the greatest pressure points in the short term, WEF’s risk report finds. Fears of an economic downturn and inflation both jumped eight positions in the two-year outlook, while the risk of asset bubbles bursting also rose sharply. High debt levels, combined with tighter financial conditions and geopolitical fragmentation, could usher in a new phase of global volatility.
These pressures are feeding into social stresses. Societal polarisation ranks fourth among near-term risks and is expected to climb higher by 2028.
Inequality – which played out in youth-led protests in Indonesia, Nepal, Timor-Leste, the Philippines and the Maldives last year – remains a persistent concern. Inequality ranked seventh in both the two- and 10-year outlooks, and is identified for the second year running as the most interconnected global risk – amplifying everything from political instability to weak climate action.
Underlying these dynamics are cost-of-living pressures and the entrenchment of “K-shaped” economies, in which wealthier groups recover and grow while lower-income populations fall further behind, the report found.
AI anxiety grows, environment loses urgency
Technology-related risks are also rising quickly. Misinformation and disinformation are ranked second in the two-year outlook, while cyber insecurity sits sixth.
The most dramatic shift, however, is anxiety over artificial intelligence (AI). Adverse outcomes of AI leap from 30th place in the two-year horizon to fifth over the next decade, reflecting concerns about job displacement, social disruption and security threats.
By contrast, environmental risks have slipped down the rankings in the short term – not because they have diminished, but because they are being crowded out by more immediate geopolitical and economic fears.
Extreme weather events fell from second to fourth place in the two-year outlook, while pollution and biodiversity loss also dropped several positions. All environmental risks declined in severity, signalling what the WEF describes as an “absolute shift” in perceived urgency.
However, over the long term, environmental threats remain dominant: extreme weather, biodiversity loss and critical changes to ecosystems are ranked as the three most severe risks over the next decade. Three-quarters of respondents expect a turbulent or stormy environmental outlook – the most pessimistic assessment across all risk categories.
The concern is that geopolitical fragmentation and economic insecurity will further weaken global climate cooperation just as impacts intensify, particularly in vulnerable regions across Asia, Africa and small Pacific island states.
While attention may be shifting towards rivalry and resilience, delaying action on climate and nature risks storing up even greater instability in the years ahead, the report warned. In a world increasingly defined by geopolitical rivalry, the cost of failing to collaborate may be the most severe risk of all, the report suggests.
Structural forces reshaping risks
Beyond the year-to-year rankings, the report warns that deeper structural forces are reshaping the global risk landscape in ways that could lock in long-term instability if unaddressed.
First introduced in last year’s report, these structural forces describe long-term shifts in how the world’s systems are organised and how they interact. Four spheres – technological acceleration, geostrategic shifts, climate change and demographic bifurcation – now form the backdrop against which global risks are unfolding, often reinforcing one another.
According to WEF, these forces are no longer abstract or distant – they are already converging, accelerating and placing growing strain on societies, economies and institutions.
For example, rapid advances in AI, biotechnology and digital systems are transforming economies and governance at speed, often outpacing regulation and social adaptation. The report links this acceleration to rising societal polarisation, as expanding digital footprints, algorithmic influence and unequal access to technology deepen social divides.
Geostrategic shifts, meanwhile, are reshaping the global order. Power is becoming more fragmented, alliances more fluid and multilateral institutions weaker. The report highlights a growing loss of confidence in global governance systems. Economic competition is increasingly “supercharged”, raising the risk of trade fragmentation and the weaponisation of economic relationships – trends that directly undermine collective responses to climate change, pollution and biodiversity loss.
Climate change remains a central structural force. The report stresses that global warming is not a single, linear pathway but a multi-directional force with multiple possible futures, depending on policy choices and societal responses. Unsustainable patterns of production and consumption are driving what the United Nations describes as the “triple planetary crisis” of climate change, pollution and biodiversity loss.
Pollution is highlighted as a critical but underestimated dimension of this crisis. While it ranks tenth in the 10-year global risk outlook, nearly a quarter of respondents express maximum concern, with younger people particularly alarmed. Air pollution, freshwater and ocean contamination, nitrogen runoff, plastic waste and emerging pollutants such as PFAS, or “forever chemicals,” are eroding ecosystem resilience and driving rising rates of disease and premature death.
The fourth structural force, demographic bifurcation, reflects diverging population trends. While some countries are ageing rapidly, with shrinking workforces and mounting pressures on pensions and care systems, others have young and fast-growing populations struggling to access jobs, housing and basic services. These demographic divides are expected to fuel inequality, migration pressures and political tension, with ripple effects far beyond national borders.
The report argues that these structural forces help explain why risks are becoming more interconnected and harder to manage in isolation. Economic shocks feed social unrest; geopolitical rivalry weakens environmental cooperation; technological change accelerates polarisation; and environmental degradation undermines health and productivity.
Addressing individual risks without tackling the underlying structural forces that drive them may offer short-term relief, but it will not deliver long-term resilience, the report said.
The report emerges the week before world leaders and business executives gather in Davos for WEF’s annual meeting next week, and sets the tone for difficult conversations about how to rebuild trust and cooperation in a fractured world, said Saadia Zahidi, WEF’s managing director.
