After an eventful 2025, 2026 promises to be as challenging and as unpredictable as was last year for geopolitics– last night’s arrest and rendition of Venezuela’s (now ex-) President Nicolas Maduro into US custody at Brooklyn’s Metropolitan Detention Center should tell us that.
There are a whole series of geopolitical issues facing today’s world
It may be helpful to set out the major geopolitical issues that the world – or important parts of it anyway – are likely to have to deal with in 2026. It may not be so unusual to have a fairly full plate of important issues awaiting resolution but 2026’s list includes a major war in Europe, the potential breakdown of the NATO alliance which has underpinned European – if not global – security for decades, the growing importance of “spheres of influence”, fluidity in national borders, a migration crisis, China’s steady rise to the top of the power league and the increasing personalization of foreign policy and diplomacy, an approach whose efficacy is as yet unproven and where a final judgment will take years to emerge. Let’s take a look!
Donald Trump is, as predicted, having an outsize influence on the world and how it operates
Donald Trump – what is there to say? His second term is now just one year old. Whether you like his approach or not, he does seem to act decisively and get results. How durable those results are, only time will tell and – once we see the results – how popular they prove to be in the longer term again only time will tell. One thing we can be quite sure of is that it will not be a quiet and smooth geopolitical environment that we discuss over the next year or two. Internally he has challenged “the deep state” and has certainly had an impact through his personnel changes, particularly at the Pentagon. More controversial are Trump’s domestic security policies which have provoked loud opposition from across the aisle. Two things to remember here: ”checks and balances” and “midterms” where the Republicans could lose control of the Congress, particularly if the cost-of-living crisis continues to escalate while Trump dismisses the entire subject. Watch out for those buzzwords as time passes and term limits come into play.
Russia-Ukraine still the biggest challenge facing the world, particularly given India and China’s positions
From our perspective of the geopolitical space, the Russia-Ukraine war is the most serious geopolitical issue Europe faces and Russia has been launching very large drone and missile strikes – over 700 drones and missiles – against Ukrainian energy infrastructure while temperatures are below freezing. Add in China, North Korea and India operating in the background by supporting Russia economically and militarily and we might conclude that the wider impact of the Russia-Ukraine war is the most serious geopolitical challenge the world faces. Here the United States has yet to fully back Ukraine in its defence against the unprovoked Russian attack, with a sense that making a deal ostensibly about the war is more important than actually stopping the war itself in a way which supports Ukraine in pushing back against an aggressive Russia. That would be my major criticism of the president’s approach: we do know – or should do by now – who the good guys are in the current scenario. They may not be perfect, but we should be able to recognize them without too much difficulty.
Putin gets the last word – a skill worth having
One thing Putin seems extremely good at is having the last word – a quite important skill it seems with President Trump. After some positive signs from the US and Ukraine suggested that the two countries were warming to each other, Russian foreign minister Sergei Lavrov emerged from the shadows to claim that an attack by Ukraine on President Putin’s residence on Lake Valdai by 91 Ukrainian drones had recently taken place. No evidence was provided to support this contention at the time and to date nothing else has been provided. That did not stop President Trump from claiming that he had heard the news directly from President Putin and was extremely upset by it, which prompted a damage limitation exercise on Ukraine’s part to cool the situation down.
Putin has maintained his hard line on ending the war, claiming that Russian forces continued to make progress and secure Ukrainian territory and that his hard-line demands were the correct basis for any discussions about the future and suggested that the war would continue into 2026. President Zelenskyy refuses to accept the Kremlin’s demands on a range of issues including territorial concessions, limits on Ukraine’s ability to defend itself and limits on NATO expansion.
Hard line from Putin remains…
Putin’s maximalist demands remain, despite the fact that progress on the ground is slow in terms of territory gained. Part of this optimism on Putin’s part may be attributable to the briefings he receives from his military, which appear to paint a rosier picture of Russian successes than is warranted by events on the ground. There are numerous reports from military bloggers suggesting that progress on the ground is harder and slower than reports from the Ministry of Defence in Moscow suggest. The level of disinformation being produced can create the impression of more and faster progress than is actually the case. However, both western sources and Russian bloggers suggest that things are not as clear cut as President Putin would have us believe.
…but the reality is that he has led Russia down a blind alley
Fundamentally, Vladimir Putin has led Russia down a blind alley costing millions of lives either ended or badly affected and incurring billions in economic losses across Europe. The damage to Russia’s future is incalculable in areas such as material losses, killed or displaced individuals, destroyed infrastructure and lost opportunities. We are at the end of a unique 30-year period of Russia opening to the west – and, almost four years on from the Russian invasion, a resolution of the conflict seems as far away as ever. But the closing of Russia to the west is increasingly evident. President Putin himself seems irritated by the opposition to Russia that he has created by invading Ukraine, describing his opponents as “swine” and offering to negotiate with the next bunch of European politicians who come along. On the face of it, Putin sounds like he believes he will win – but he has to sound like that or else his maximalist demands will remain forever out of his reach. Volodymyr Zelenskyy seems to realise this and continues to maintain his opposition to any Russian encroachment on Ukrainian territory.
EU unable to agree on seizing Russian assets at Euroclear, decides to lend its own funds rather than seize Russia’s
After very lengthy and protracted discussions – and an evident unwillingness on the part of the EU to directly seize some of the €210 bn of Russian assets that have been frozen at Euroclear and elsewhere – the EU finally agreed to make a loan of €90 bn from the bloc’s budget secured on that shared budget and designed to finance Ukraine for the next two years. Kiev will repay the loan only when it receives reparations from Russia but the frozen Russian assets could also ultimately be seized if Russia fails to pay those reparations. The latter had threatened to seize further western assets if its own assets held in the EU were themselves seized. The agreement to lend €90 bn to Ukraine is a positive sign, had the group failed to find a way to help Ukraine, it would probably have called into question the EU’s own broader credibility as a global actor. In the event, it seems that Russia is the party most annoyed by the agreement.
China demonstrated both its soft power and hard power in the same 24-hours recently
Let’s not forget China – which is impossible to do when living in Hong Kong since it’s ever-present – in a good way, half of the city disappears every weekend to the Chinese border city of Shenzhen – just 14 minutes away on the High-Speed Rail – where entertainment and partying are far cheaper than in Hong Kong! President Xi highlighted China’s “rising national power” in his New Year’s Eve address as well as the growth of its soft power. On display on New Year’s Day was China’s hard power: after the US approved an $11 bn arms sale to Taiwan as part of an overall additional spend of $40 bn the PLA Navy surrounded Taiwan with live-fire exercises, rehearsed blockades of the islands and fielded some of its newest combat ships in its most extensive war games to date.
Xi may get more from a planned US-China summit than Trump does
Xi and Putin exchanged New Year’s messages of course, while Trump himself, by all accounts, seems to be looking forward to his summit with Xi Jinping in April next year. Xi may well also be looking forward to the meeting, where rare earths and advanced computer chips are important topics. I sense that Xi may be more on the front foot than Trump on these issues, bearing in mind the gifts that Trump has sent Xi’s way, including allowing the sale of both advanced Nvidia H200 chips and reduced export tariffs on them. One or two observers have concluded that if China is going head-to-head with the US, it would probably help the US to have Europe in its corner. But that isn’t happening. Instead, in Trump’s national security strategy, we have the US challenging Europe rather than joining forces with it.
Geopolitical challenges in the Middle East…
The Middle East isn’t immune from geopolitical challenges – with reports of a rift between the Saudi and UAE leaders over influence in the region and air strikes against Yemeni targets. It seems that Saudi has been pressing the UAE to get some of its Yemeni proxies to withdraw from provinces next to Saudi Arabia – not that successfully. Any disagreement among the senior Middle East leaders is always a concern given the potential for instability but so far we have seen just two strikes against Yemeni targets to stop arms shipments from the UAE from reaching southern separatist forces.
…and now in Venezuela and Greenland
With Venezuela’s Maduro in custody, Greenland is another issue that seems to be coming to the fore and being mentioned, by US observers, in the same breath as Venezuela and Cuba. Not that Greenland is an actual threat to anyone, but it seems that the US has its eye on the Danish colony to enhance its hemispheric defence strategy and expand its sphere of influence. Trump has appointed the Governor of Louisiana as his special envoy, prompting consternation in both Greenland and Denmark, which happens to be a NATO ally. I’ve been to Greenland a few times for wilderness camping and the last time I was there Trump was offering to buy it – for defence purposes or as a new northern riviera real estate opportunity I was never sure. What was clear was that neither Greenland nor Denmark were actually interested in selling Greenland to the US – despite the defence facilities on the island, including the US Pituffik/Thule Space Base and the disused – and now buried – Cold War base of Camp Century. Finland, Norway and Sweden all support Denmark in its opposition to being forced to divest its Greenlandic colony. Canada and the Panama Canal are also being spoken of as essential to the US’ defence strategy in the western hemisphere – that is a lot of real estate. This one looks as if it will run and run unless some broad accommodation between Europe and the US can be reached.
“The challenge of the Middle Powers”
The developing situation in Greenland and the recent US actions in Venezuela highlight what I would call “the challenge of the middle powers”. With the US unexpectedly stepping back from sole global leadership. (Alec Russell describes this as “the coming of age moment for middle powers”) it is not clear that this moment is necessarily welcomed by those middle powers. America’s stepping back from global leadership has happened rather faster than many are likely to have expected or even wanted and it will take time for the dust to settle.
Europe has to accept that there is global geopolitical instability according to a number of well-informed political commentators I read. I would suggest that most of the European actors are just hoping for lower energy prices (a likely outcome if a deal between Russia and Ukraine is ever reached). I doubt however that too many people will rush to rebuild their past dependence on Russia as a source of oil and gas – these are among the “lost opportunities” I highlighted abov
