Salient aspects of the geopolitical risks and impact on the global supply chain

Abstract

The pandemic and recent geopolitical instability have highlighted the vulnerability of the global supply chain and many sectors have experienced shortages of raw materials and critical goods. The global supply chains are increasingly regionalized to mitigate risks from uncertainties such as US-China trade conflicts or the Ukraine war. In this environment, the category procurement needs to adapt and build a more resilient supply chain. To enhance resilience, effective adaptability is needed by regionalization, supplier collaboration, digitalization and data analytics and risk categorization. This study aims to analyze recent research focusing on geopolitical risks impacting macroeconomics, raw materials, energy demand and logistics and to formulate shared perspectives for higher impacts. For this purpose, a systematic literature review, based on 22 articles, was carried out to observe the main areas of concern in case of geopolitical turmoil and to identify the main factors for the supply chain resilience. The collective viewpoints conclude that, in this challenging environment, the industries must adapt quickly, enhancing their flexibility and resilience, invest in digitalization and data analytics for better visibility and prediction and consider supplier collaboration and regionalization as key factors in their procurement strategies. Further research is needed to define the geopolitical risk categorization