As a major global issue that spans politics, business, energy and sustainability, geopolitical tensions require interdisciplinary analysis and long-term perspectives.
Geopolitical tensions manifest in different ways, from diplomatic disagreements and trade conflicts to international armed conflict and power rivalries. Academic elucidation of these tensions requires unpacking their structural layers, which are shaped by historical legacies and evolving norms in an interconnected world. They are shaped by the distribution of resources, like energy, and the uneven spread of power and wealth.
For example, a nation with large energy reserves can wield significant geopolitical influence, as evidenced by the growing conflicts over Syria’s oil fields and other regional energy sources. In contrast, nations heavily reliant on energy imports can be vulnerable to supply disruptions and price volatility, factors that can exacerbate international tensions.
These tensions can also impact a country’s sovereign risk, affecting everything from GDP growth and investment rates to employment and unemployment. The economic impacts are especially pronounced in border and neighbour countries, where escalating geopolitical tensions can disrupt trade routes, hinder cross-border investments and capital flows and lead to heightened economic uncertainty.
It’s easy to think of geopolitical struggles as high-level games of strategy, but their consequences ripple down into our everyday lives. A trade war in an oil-producing country drives up petrol prices, for instance. And a war between a nation and its neighbours can create a climate of fear and heightened security concerns, which has real-world implications on our economy, safety and quality of life.
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