Technology can aid unprecedented geopolitical risk mapping in 2026

The year 2026 begins with a new geopolitical crisis as the conflict in Venezuela could have a cascading impact on energy markets. Anticipating, assessing and absorbing risks is now a constant concern for most business leaders. As geopolitical uncertainties fester and grow, this year is likely to throw up more unprecedented risks.

 

Many organisations have published their risk assessments for this year. European financial leader ING for instance outlines ten potential risks for the global economy in 2026, including an AI bubble burst, inflation from supply bottlenecks, US tariff changes, European consumer spending shifts, US-China tensions over rare earths, oil price spikes, fiscal crises, China’s property downturn, and geopolitical shifts like a Ukraine peace deal.

 

Even though the AI bubble could be a challenge, emerging technologies are being used for risk modelling that can help manage unplanned changes.Like many assessments, it is difficult to assess which ones will play out as predicted. Consequently, companies are leaning towards AI to help them interpret disruptive changes.AI-powered scenario planning is transforming the way organisations approach risk management and strategic decision-making.

 

Unlike traditional methods that rely heavily on historical trends and manual effort, AI-driven approaches are faster, more accurate, and scalable. They can process vast datasets, deliver real-time insights, and reduce human bias, while conventional techniques often struggle with errors and inefficiencies. By leveraging technologies such as machine learning, predictive analytics, and natural language processing, AI enhances risk identification, assessment, and mitigation, enabling businesses to make more informed decisions.

 

Financial forecasting is one area where AI has had a profound impact. Companies can now reforecast earnings in days rather than weeks, generating instant financial plans and comparing scenarios with ease. AI models also evaluate multiple risk factors simultaneously, assigning scores that help organisations prioritise risks.

 

In addition, machine learning algorithms are adept at analysing transactional data, detecting unusual patterns, and flagging fraudulent activities, a capability especially critical in industries like finance and retail where billions of transactions occur daily. AI is also reshaping geopolitical risk forecasting. By processing massive amounts of raw data at speeds far beyond human capability, AI tools transform complex global dynamics into actionable insights. Businesses gain a competitive edge by protecting investments and uncovering new opportunities. Unlike traditional risk assessments that depend on periodic updates, AI systems continuously monitor global events, tracking political developments, public sentiment, economic trends, and trade dynamics, and providing immediate insights as situations evolve. But caution is necessary too.

 

Poor data quality— whether inconsistent, inaccurate, outdated, or incomplete — can lead to flawed risk assessments. Algorithmic bias, often stemming from skewed or limited datasets, can result in discriminatory practices that negatively affect stakeholders. Organisations must therefore ensure data integrity and fairness.

 

AI is also revolutionising scenario modelling, particularly in regulatory compliance. Traditional scenario modelling requires significant expertise and resources, but generative AI automates and enhances the process, making it more efficient and reliable. By using historical data and predictive analytics, generative AI creates realistic and diverse future scenarios, ranging from minor regulatory amendments to major legislative overhauls. These simulations allow organisations to anticipate regulatory changes, identify compliance gaps, and develop strategies to mitigate associated risks. 

 

According to research agency Growth Market Reports, the global Scenario Planning Software market was valued at $2.13 billion in 2024 and is set to maintain strong growth momentum. From 2025 to 2033, it is forecasted to grow to $6.31 billion. “One of the primary growth factors fuelling the Scenario Planning Software market is the accelerating pace of business disruption, driven by factors such as geopolitical instability, economic volatility, and technological advancements,” the agency says.

 

Asia Pacific is the fastest-growing market for this category, driven by accelerated digital transformation, rising emphasis on risk management, and the expanding presence of multinational corporations across major economies such as China, India, and Japan.