Core Trends: RCEP accounts for 66% of intra-regional trade, semiconductors split into parallel systems, clean energy investment tops $2.1 trillion.
Geopolitics and Tech Drive Restructuring
Global supply chains are undergoing structural shifts:
- Semiconductor “Dual Systems”: U.S.-led advanced nodes (<7nm; TSMC 70% share) vs. China-controlled mature processes (>28nm; 60% global capacity), with Japan/South Korea balancing via materials/memory chips.
- EV Regionalization: China dominates battery production; U.S. pushes localization via IRA subsidies; EU leverages carbon border taxes for standard-setting.
- Data Localization: EU’s Digital Services Act boosted cross-border digital transactions by 22%, spurring global data sovereignty laws.
Regional Frameworks Advance Divergently
- Asian Integration Deepens: RCEP fueled 3% regional trade growth since 2024; China-ASEAN FTA 3.0 now covers digital/green economy rules.
- Europe’s “Strategic Autonomy” Struggle: Efforts to reduce U.S. dependence clash with 0.7% 2024 growth constraints.
- Fragmented Energy Cooperation: OPEC+ output swings (oil: $65-75/bbl) and Middle East conflicts threaten shipping lanes, accelerating localized energy storage adoption.
New Governance Models Take Shape
OECD urges integrated “Monetary-Fiscal-Structural Policy” frameworks:
- Multilateral banks must address the Global South’s $3.5 trillion annual clean infrastructure funding gap.
- With dollar hegemony waning (58% of reserves), local currency usage grows – though dollar assets remain irreplaceable short-term.
Energy Transition Index data shows just 28% of nations simultaneously advancing energy security, sustainability, and equity – demanding stronger cross-border grid interconnections and standardized tech protocols.