The Geopolitical Shift: Localization, Protectionism, and the New Investment Playbook

* Last week I went back to my favorite conference (FII Priority) and it inspired me to pull some thoughts together.

2015: Predicting the Shift at General Electric

In 2015, when I was asked to help with GE’s global strategic Growth Playbook, one of the major forecasts was the rise of localization and populism. It was clear that global trade, once seen as an unstoppable force, was shifting. My presentations warned that GE was too big to pivot quickly, and without drastic measures, adapting to a protectionist world would take years.

(*General Electric was a pioneer in commercializing digital twins, predictive analytics, and early discussions on agent-to-agent collaboration as early as 2015, laying the groundwork for AI-driven industrial automation long before these concepts became mainstream).

The reality of deglobalization became evident through:

• Populist movements disrupting global trade norms.

• COVID-19 exposing fragile supply chains and accelerating reshoring.

• Government policies shaping economic strategy, such as the CHIPS Act and China's push for self-sufficiency.

GE, like many industrial giants, struggled to adapt, ultimately breaking apart in 2021. The lesson? If businesses don’t proactively adjust to macro shifts, the market will force them to.

Sources: The Economist, “The Age of Slowbalization” (2019); McKinsey & Co., “The Future of Trade” (2023).

U.S. Debt: Japan & China’s Retreat and the Crowding-Out Effect

The U.S. public debt has reached wartime levels, and unlike previous cycles, the largest buyers of U.S. Treasuries—Japan and China—are stepping back.

• China has reduced its Treasury holdings, prioritizing internal stability and de-risking exposure to the U.S. dollar.

• Japan is focusing on domestic investment and is no longer accumulating U.S. debt at past levels.

With fewer foreign buyers, the U.S. must attract new capital by keeping rates higher, which creates a crowding-out effect:

1. More government spending goes to debt interest instead o

   f critical investments (infrastructure, education, healthcare).

2. Higher Treasury yields pull money away from private-sector investments, slowing innovation and economic expansion.

3. Markets remain stable—until they don’t. If debt levels remain unchecked, confidence erodes, leading to inflationary risks and higher borrowing costs.

Sources: Federal Reserve Bank of St. Louis, “Who Buys U.S. Debt?” (2023); IMF, “Sovereign Debt Risks in the 21st Century” (2022).

The Global South: Infrastructure & Energy as a Make-or-Break Factor

As advanced economies localize and automate, the Global South risks being left behind without major infrastructure and energy investments.

• $15 trillion infrastructure gap by 2040 (World Bank).

• 600 million people in Africa lack electricity (IEA).

• China’s Belt and Road Initiative (BRI) has invested over $1 trillion in developing economies, but concerns over debt sustainability remain.

Without scalable energy solutions and modern infrastructure, emerging economies will struggle to participate in the next wave of industrialization.

Sources: World Bank, “Infrastructure Investment in the Global South” (2023); IEA, “The Future of Energy in Africa” (2022).

AI and the Future of Work: A Human-Centric Approach

At OGroup, we believe the future of AI isn’t about full autonomy but collaborative intelligence—multimodal systems that work alongside humans.

• AI should augment human capability, not replace it.

• The future of work will depend on AI-human collaboration, not competition.

• Governments must proactively design AI-integrated workforces, or risk social and economic disruption.

This is why one part of OGroup is focused on:

• Helping governments craft AI-driven workforce strategies.

• Designing AI tools that enhance, rather than replace, human decision-making.

• Ensuring AI drives productivity in industries, rather than creating structural unemployment.

AI will reshape industries, but the key question is: Will we design AI for human collaboration, or let it dictate the future?

The Bottom Line

The world is shifting toward localization, resource security, AI-driven industrialization, and rising debt burdens. The winners will be those who adapt early and invest strategically.

I do believe that the most exciting breakthrough of the twenty-first century will not only occur because of technology, but because of an expanding concept of what it means to be human and how we will interact with technology.

Welcome to the new era of economic power.