Market and product

The World Economic Forum (WEF) and consulting firm Kearney have released their 2026 annual report on global value chains, noting that global supply chains are undergoing profound restructuring driven simultaneously by geopolitical tensions, technological acceleration and economic volatility.

The report, titled “Global Value Chains Outlook 2026: Orchestrating Resilience for Business and Nation”, is based on more than 100 consultations with leaders from business, government and academia, along with a survey of over 300 senior executives worldwide.

Context: The Old Model No Longer Fits

According to the report, supply chains built over decades—with priorities centered on cost optimization and free trade—are now revealing significant vulnerabilities in the face of repeated shocks.

In 2025 alone, escalating tariff measures among major economies redirected more than $400 billion in trade flows. Disruptions in the Red Sea and the Panama Canal drove container shipping costs up by approximately 40% year-on-year. At the same time, manufacturing output in advanced economies recorded its weakest growth since 2009, according to data from the International Monetary Fund (IMF).

The report identifies five structural forces reshaping global supply chains: slow and uneven economic growth; fragmentation of trade networks; geopolitical instability; accelerating technological adoption; and rising demands for transparency and trust across supply chains.

Recommendations for Businesses: Three Strategic Priorities

For the private sector, the report outlines three strategic directions considered foundational for adapting to a volatile environment.

First, shift from operator to ecosystem orchestrator.

Rather than controlling the entire production chain independently, companies are encouraged to build diversified partner networks—including suppliers, logistics providers, technology partners and contract manufacturers—and coordinate these networks toward shared objectives.

Second, distribute production capacity instead of concentrating it.

Large, centralized factories once optimized costs but can now become bottlenecks during disruptions. The report notes a marked increase over the past five years in the number of executives regionalizing their production footprints.

Third, design resilience for growth—not merely risk mitigation.

Approximately 74% of surveyed leaders believe that investment in resilience can drive growth, not just reduce losses.
Key enablers supporting these priorities include robust data infrastructure and AI deployment; capabilities to forecast geopolitical and regulatory risks; agile supply chain governance; organizational structures capable of rapid decision-making; and a workforce trained for digitally integrated manufacturing environments.

Recommendations for Governments: Seven Readiness Factors

For policymakers, the report introduces a framework of seven critical factors that each country should prioritize to build competitive and adaptive industrial ecosystems.

1. Connectivity Infrastructure

Governments are advised to develop integrated, multimodal logistics master plans linking seaports, airports, railways and highways. Large-scale digital infrastructure—including 5G networks, AI-ready data centers and industrial connectivity—is viewed as essential to support real-time manufacturing. Special economic zones offering “plug-and-play” infrastructure integrated with digital technologies and clean power grids are recommended as a replicable model.

China is cited as an example: its 2020 “New Infrastructure” program helped deploy more than 4.25 million 5G base stations and achieve over 71% 5G user penetration, alongside more than 4,000 5G-connected factories nationwide.

2. Energy and Resource Security

The report recommends comprehensive national resource strategies, particularly for metals and minerals essential to high-tech production. Strategic reserves and joint procurement agreements for critical raw materials—such as lithium and rare earths—are proposed to reduce single-source dependence. Balanced energy systems combining renewables, nuclear and conventional sources are considered necessary to ensure stable, affordable and low-carbon electricity supply.

Qatar is highlighted for its national dashboard tracking 24 essential food commodities in real time, issuing alerts when stock levels fall below safety thresholds. During COVID-19, monitoring expanded to include masks, protective equipment and industrial inputs.

3. Technology and Innovation Capacity

Governments are encouraged to launch national programs focused on advanced technologies such as AI, cybersecurity and quantum computing, while developing trusted cross-border data exchange frameworks. Mandatory cybersecurity standards in critical industrial value chains are recommended as a baseline requirement.
By 2023, China recorded 4.4 million patent applications and 7.8 million trademark filings following implementation of a national intellectual property action plan aligned with World Trade Organization standards.

4. Labor and Skills

The report calls for national human capital roadmaps aligned with advanced industry needs. Business-led “future skills councils” are recommended to define standards and coordinate training among educational institutions, enterprises and regulators.

Ireland is cited for its Skillnet Ireland model, which leverages 70 enterprise networks to deliver subsidized training to more than 24,700 companies and 92,400 employees annually in digitalization, innovation and leadership.

5. Sustainability

Governments are advised to issue national guidance for low-carbon industrial transitions, including green finance and circular supply chains. Enforceable and harmonized sustainability reporting—covering carbon emissions, resource management and material reuse—is recommended to ensure accountability across value chains.

Singapore is referenced for its Green Plan 2030, a nationwide sustainability roadmap supported by a SGD 35 billion green bond program and a SGD 50 million fund for community and enterprise transition.

6. Fiscal and Regulatory Environment

Regulatory stability and predictability are emphasized as critical for attracting long-term investment. Recommendations include stable legal frameworks across political cycles, one-stop administrative systems, strengthened rule of law and anti-corruption measures, and AI-enabled real-time compliance monitoring.

Tamil Nadu in India is cited for maintaining a consistent investment climate for over 15 years, attracting long-term multinational investment. Estonia is mentioned for its e-governance model that significantly reduces administrative burden and corruption.

7. Geopolitical Positioning

The report recommends proactive, multi-vector foreign policy strategies to shield economies from bilateral or regional shocks. Measures include diversifying trade partners, expanding alternative export markets, reducing regional development disparities domestically, and offering state-backed risk guarantees for investments in geopolitically sensitive regions.

Vietnam is cited for its “bamboo diplomacy” approach—maintaining flexible, multidirectional relationships with multiple partners—thereby supporting stable trade and investment flows amid global realignment. Morocco is also referenced for positioning itself as a regional manufacturing hub by leveraging proximity to Europe and building a network of over 250 European-standard automotive suppliers.

Case Examples

The report cites several cases to illustrate its arguments. During the 2020–2022 semiconductor shortage, Ford Motor Company shifted to a build-to-order production model, allocating scarce chips to higher-margin vehicle lines and removing certain non-essential features. As a result, the company’s order volume in the U.S. market increased to seven times its pre-pandemic level.

On the government side, Qatar is highlighted for its real-time monitoring system for essential food reserves, which was expanded during COVID-19 to include medical supplies and industrial inputs. Vietnam is mentioned for its flexible diplomatic approach (“bamboo diplomacy”), enabling the country to maintain multidirectional relationships and reduce the risks associated with dependence on a single trading partner.

New Tool: Manufacturing and Supply Chain Readiness Navigator

The report introduces a new analytical tool—the Manufacturing and Supply Chain Readiness Navigator—built upon the National Readiness Framework developed in earlier WEF–Kearney reports and internationally recognized datasets.

This modular, interactive tool measures national readiness across all seven factors. Rather than offering a fixed ranking, it enables flexible comparisons based on user priorities and strategic context.

For businesses, the tool supports data-driven decisions on expanding or rebalancing global footprints. Executives can assign weightings to readiness factors depending on industry characteristics, product complexity and risk appetite. A semiconductor manufacturer, for instance, may prioritize infrastructure reliability and energy security, while an apparel company may emphasize labor capacity and trade access. The output is a ranked portfolio of potential locations aligned with growth strategy and risk tolerance.

For governments, the tool functions as a diagnostic and benchmarking system, helping identify competitiveness gaps, prioritize high-impact reforms and communicate progress transparently to international investors.

According to the report, the ultimate objective is to establish a shared data platform that aligns public and private decision-making through a unified measurement lens—transforming policy dialogue into substantive collaboration between governments and enterprises.

The report “Global Value Chains Outlook 2026” was published in January 2026 by the World Economic Forum and Kearney.