Transnational business in conditions of geoeconomic fragmentation

Abstract

The formation of a polycentric system of international relations leads to geoeconomic fragmentation of international trade. Interstate contradictions create specific risks for multinational companies (MNCs). As a result of the emergence of a “new” world order, transnational corporations face risks of disruption of global supply chains, strengthening of protectionist policies, introduction of inconsistent standards that are incompatible with each other and dissemination of non-market restrictions in the field of investment, technology and access to foreign markets. The impact of modern international contradictions on the strategic approaches of MNCs is analyzed. General aspects of the fragmentation in the world economy and its likely limits are examined. International economic challenges for business are studied, as well as political and reputational risks (based on the example of the Russian Federation). It is concluded that the corporate sector has to take certain political positions due to interstate conflicts. Consequently, a new non-economic factor influencing transnational companies’ strategic management is identified.