Guest Post by Guy Douetil, Director of GWD Advisors Ltd

As 2024 draws to a close, we continue to witness significant changes in the global business landscape. The world is increasingly volatile and unpredictable.

As the Director-General of the World Trade Organisation recently noted, “These are troubling times for global trade [...] amid geopolitical tensions and the backdrop of the climate crisis, we see increased protectionism [...] trade may be starting to fragment along geopolitical lines.”

Here is GWD Advisors’ take on key changes we are facing, their impact on location strategy, and how to address them:

Change 1: Shifting Demographics

• Challenge: A decline in birth rates combined with ageing societies is causing shrinking working-age populations, particularly in Europe and parts of Asia, creating a demographic crisis.
• Solution: Prioritise locations with healthy demographic prospects and the ability to absorb migrant populations.
• Where: Consider Sweden, Turkey and the UK for their projected growth in working-age populations. Countries like Germany, Italy, Hungary, and Poland may face economic challenges due to shrinking demographics. Elsewhere, North America and Australia are projected to see increases in their working-age populations.

Change 2: Climate Change and Resource Scarcity

• Challenge: The increasing demand for sustainable energy and the growing scarcity of resources, such as water, pose significant risks.
• Solution: Evaluate locations with self-sufficient (not import-dependent) and sustainable energy sources, as well as those not under acute water stress.
• Where: Scandinavia offers a strong balance of energy self-sufficiency and green credentials. Countries like Slovakia and Hungary may be more vulnerable to supply chain disruptions, while Romania is emerging as a potential regional energy powerhouse.

Change 3: Geopolitical Headwinds

• Challenge:  In an increasingly polarised world, trade wars, military conflicts, and political upheavals are creating uncertainty in the global trading environment.
• Solution: Diversify and duplicate locations and supply chains to mitigate potential external shocks.
• Where: Consider expanding supply chain links to Mexico, Morocco, Vietnam, and India, which have benefited from recent geopolitical changes. Flexibility and adaptability are key to navigating these challenges.

By understanding these global trends and implementing strategic location decisions, your business can position itself for long-term success.

Guy Douetil is Director of GWD Advisors Ltd