The re-pricing of world order – a treasury perspective

For roughly three decades after the Cold War, geopolitics functioned as background plumbing. It was critical, but mostly invisible. Wars flared at the periphery, sanctions regimes were episodic, and trade disputes were noisy but manageable. For corporate treasurers and CFOs, the working assumption was straightforward: the legal and institutional framework underpinning trade, payments and capital flows was sufficiently stable to treat political risk as a modelled variable, not a structural constraint.

Contracts were enforceable across borders. Capital was mobile. The US dollar sat at the centre of global invoicing, funding and reserves. Payment systems were politically neutral utilities. That baseline no longer holds with the same confidence. What we are witnessing is not the collapse of the international order. It is its repricing.

Economic statecraft goes mainstream

Since 2014 – and decisively since Russia’s full-scale invasion of Ukraine in 2022 – economic instruments have moved from the margins of foreign policy to its core. Sanctions have become broader and more coordinated. Export controls, particularly in advanced semiconductors and dual-use technologies, have deepened. Industrial policy has returned across major economies. Strategic sectors are being ring-fenced in the name of national security.

The freezing of a large share of Russia’s central bank reserves in 2022 marked a watershed moment. For the first time in the modern era, a G20 economy saw sovereign foreign exchange assets rendered inaccessible by coordinated political decision. That step did not end the dominance of the US dollar, which still accounts for the majority of global trade invoicing, FX turnover and cross-border debt issuance. But it did alter how states and corporates think about optionality, counterparty risk and access.

Sanctions compliance, dual-use licensing, export control reviews and investment screening have moved from niche legal concerns to board-level priorities. Secondary sanctions risk – exposure through counterparties rather than direct transactions – now features in credit committees. Even in jurisdictions not directly targeted, companies must assess whether a banking corridor, insurer or logistics provider could become entangled in a broader political dispute.

From territory to control points

Power in the 21st century is often exercised not through territory, but through control points: clearing systems, payment messaging networks, semiconductor supply chains, rare earth processing, shipping insurance, cloud infrastructure and data standards.

The ability to restrict access to advanced chips, deny insurance coverage to tankers, suspend a bank’s correspondent relationships or impose technology licensing barriers can generate economic effects comparable to traditional coercive tools. For treasurers, that means counterparty risk is no longer purely a question of balance sheet strength. It includes regulatory exposure, geopolitical alignment and operational resilience.

A bank can be solvent yet unusable if it loses access to dollar clearing. A currency can be liquid yet politically exposed. A contract can be valid on paper yet practically unenforceable if sanctions intervene.

The investment regime has shifted

The repricing of order is also visible in capital expenditure decisions. The efficiency-driven model that defined the 2000s and 2010s – just-in-time supply chains, single-source suppliers, lean inventories and global labour arbitrage – is giving way to a resilience-oriented framework.

Across the US, Europe and parts of Asia, governments are deploying industrial policy to incentivise domestic semiconductor fabrication, battery production and critical mineral processing. Companies are diversifying suppliers, reshoring or nearshoring selected production lines, and investing in cyber hardening and redundant energy systems.

These investments are rational responses to geopolitical uncertainty. But they are less productivity-enhancing than the hyper-optimised global supply chains they replace. Building redundancy resembles buying insurance: it improves robustness but rarely maximises short-term return on capital.

The ultra-low inflation and ultra-low-rate environment of the 2010s was supported by abundant global labour supply, integrated supply chains and relative geopolitical calm. As fragmentation increases and industrial policy embeds higher cost structures, inflation volatility is likely to remain structurally higher than the pre-pandemic norm. Nominal financing costs, while fluctuating with the cycle, are less likely to revert to the compressed levels that defined the post-global financial crisis decade.

For treasury teams, this argues for stress-testing funding strategies against higher average yields, wider credit spreads during geopolitical stress and periodic liquidity fragmentation across regions.

The dollar: dominant, but no longer taken for granted

Predictions of imminent de-dollarisation remain overstated. The US dollar continues to dominate global trade invoicing, international debt issuance and foreign exchange turnover. No other currency currently matches its depth, liquidity, institutional backing and network effects.

Yet marginal diversification is underway. Certain bilateral trade relationships increasingly use local currencies. Some central banks have modestly adjusted reserve compositions, including gold accumulation. Alternative payment arrangements are being explored within regional blocs.

To be more concrete: central banks purchased an estimated 863 tonnes of gold in 2025; the metal now accounts for nearly 20% of global official reserves, up from 15% at end-2023.

A parallel development is the rapid maturation of alternative cross-border payment architectures. Project mBridge – the China-led multi-CBDC platform involving Hong Kong, Thailand, UAE and Saudi Arabia – crossed $55bn in cumulative transaction volume in early 2026, with the digital yuan accounting for 95% of settlements. Real-value government and commodity transactions are now settling in seconds rather than days, outside the traditional correspondent banking network. These rails are still niche, but they illustrate how quickly parallel infrastructure can scale when incentives align.

These developments do not herald a collapse of dollar hegemony. The dollar remains dominant (56.9% of allocated reserves, little changed on an exchange-rate-adjusted basis). They reflect a rational calculation in a more politicised environment: optionality has value and concentration risk carries a premium.

For corporate treasurers, the lesson is to avoid overreliance on a single funding market, settlement system or banking corridor. Diversified liquidity pools, multi-currency funding access and geographically distributed cash management structures reduce vulnerability to geopolitical shocks.

FX strategy in a politicised world

Foreign exchange volatility is no longer driven solely by rate differentials and growth surprises. Sanctions risk, trade fragmentation and fiscal credibility now shape currency dynamics more visibly.

Under stress, currencies within politically aligned blocs may move together, amplifying correlation risk. Commodity exporters can experience heightened volatility if supply disruptions or sanctions affect key flows. Safe-haven behaviour itself may become more conditional, depending not just on credit quality but on perceived neutrality and rule-of-law protections.

Treasury hedging frameworks that rely exclusively on macro correlations risk missing these geopolitical overlays. Scenario analysis must incorporate political triggers: a sudden export control expansion, a sanctions escalation between major economies or a maritime disruption in a strategic chokepoint.

The political balance sheet

In this environment, companies carry what might be called a political balance sheet alongside their financial one.

Questions that once sat outside treasury dashboards now demand systematic attention. What proportion of revenues is exposed to sanction-sensitive markets? How concentrated are suppliers in jurisdictions subject to export controls? Where is cash pooled and could capital controls or regulatory interventions impede repatriation? Are key banking partners diversified across political blocs?

Safe havens reconsidered

Historically, a safe haven was defined by sovereign credit quality and market liquidity. Today, safety increasingly encompasses enforceability, access and predictability. The ability to hold assets without arbitrary interference, to settle transactions reliably and to repatriate cash flows under strain has become central to defensive positioning.

For corporates, this may influence the jurisdictional allocation of liquidity reserves, custody arrangements and even long-term investment footprints. Jurisdictions with strong rule-of-law protections, credible institutions and resilient financial plumbing command a premium not merely in sovereign spreads, but in strategic confidence.

Hybrid order, not chaos

It is important to resist alarmism. The current phase does not represent a descent into systemic breakdown. Historically, hybrid orders – where rules coexist with explicit power politics – have been common. The post-1990 moment of relatively frictionless integration was unusual in its breadth.

Trade continues. Capital flows persist. Financial markets remain deep and innovative. But the assumption that politics sits outside financial architecture is no longer defensible.

The repricing of order unfolds gradually, through cycles of escalation and apparent calm. Each diplomatic thaw tempts markets to assume restoration of the old equilibrium. Yet the structural features – strategic competition between major powers, embedded industrial policy, securitised technology ecosystems – suggest a more persistent shift.

For treasury leaders, the prudent stance is neither fatalism nor complacency. It is disciplined adaptation. Geopolitics must be treated as an endogenous variable in financial planning. Liquidity buffers should be calibrated not only to recession scenarios but to payment disruptions and regulatory fragmentation. Funding strategies should incorporate diversification across currencies, markets and counterparties. Risk dashboards should integrate political indicators.

Geopolitics is no longer background plumbing. It has become part of the core infrastructure of financial strategy. And for treasury professionals, understanding that repricing may prove to be one of the defining competitive advantages.