Geopolitics dominated the opening sessions of this year’s City Week, organised by City and Financial, with two sessions that set the tone. The first covered shifting geopolitical developments, trade flows and investment priorities, and the second was a keynote address by Dr. Indermit Gill, Chief Economist and Senior Vice President for Development Economics at the World Bank Group.
Two overarching themes stood out for us: selective alignment and diversification. In the first session, moderated by Penny Miller, UK Country Head and Partner at Simmons & Simmons, panellists were united in their views of the new world order in which we are in — not just in terms of a much-changed U.S. political climate, but also in terms of how middle powers, Europe and the UK, must now navigate the new low-trust world that has emerged to replace globalisation and multilateralism. That characterisation was mentioned by Anna Rosenberg, Head of Geopolitics at Amundi, and it was one that panellists broadly agreed with.
On selective alignment, a term used by Sir Simon Fraser, Chairman of the Royal Institute of International Affairs (Chatham House), and one that is new to us, accurately depicts a world dominated by tariffs, sanctions, export controls and resource competition. In fact, one could argue that it is resource competition that drives the rest, and we see this play out in the US’ dealings. Take for example the various discussions around critical minerals: the United States recently reiterated its position about how it engages with mineral-rich nations such as Australia and certain African and South American countries, while continuing to take stakes in private mining companies. Furthermore, while it has pulled USAID, the DFC continues to push ahead with critical mineral supply chain investments in its bid to challenge China’s dominance.
Diversification is how middle powers are responding in practice. The EU’s Global Gateway, through the European Investment Bank, continues to invest in energy projects such as green hydrogen in Namibia and is also shifting its focus from aid to commercial investment by supporting South Africa’s well-established clean energy, transport and pharmaceutical industries. Its recent investment roadshow hosted at the Johannesburg Stock Exchange saw over 350 European and South African investors, companies and financial institutions gather to mark the EU’s first major event to mobilise private capital, with a EUR 11.5bn package unveiled. Meanwhile, the UK hosted the Ghana-UK Investment Summit in London, where total deals valued at up to GBP 215mn were announced across a 2026 to 2028 roadmap targeting private sector growth and infrastructure. The headline commitment was a GBP 101mn PIDG-backed initiative to develop the first commercial-scale ship repair and dry-docking facility in the Gulf of Guinea at Takoradi Port. British International Investment, meanwhile, launched British Climate Partners, a vehicle designed to scale an investible pipeline of climate projects directing capital into India and South-East Asia.
Also on the panel was Mark Bowman, Vice President of Policy and Partnerships at the EBRD, who outlined the bank’s traditional focus on Eastern Europe, North Africa and Central Asia. What wasn’t mentioned, though worth noting, is that the EBRD has also been quietly expanding into sub-Saharan Africa. Benin, Côte d’Ivoire, Kenya, Nigeria and Senegal became the bank’s newest countries of operation in 2025, with Ghana expected to follow in 2026. For an institution traditionally anchored in Europe’s neighbourhood, it is a significant step and one that sits squarely within the diversification theme running through the discussions.
The global growth picture
This brings us to the second session, Dr. Gill’s keynote on the outlook for the global economy, which put to bed any lingering misconceptions about a resilient global economy. Prior to the Iran conflict, the world economy was already in a bad place, with growth in the US, China and India doing most of the heavy lifting.
Strip those three out of the global growth figures and the results are weak. In fact, global growth has been falling for years, and new technologies, artificial intelligence in particular, are now among the only factors likely to stimulate it. But even here the world is split. North America, East Asia and South Asia view AI as an aggregate benefit, while Africa, Latin America and Europe remain overly focused on its risks rather than its opportunities. These diverging views, Dr. Gill noted, are being explored in a forthcoming World Bank report on AI for developing economies.
For the world’s small economies, citing Vietnam as an example, Dr. Gill was clear on what the path to growth looks like: trade liberalisation, fiscal discipline and business readiness. A straightforward prescription, perhaps, but in a low-trust world of selective alignment and diversification, the basics matter more than ever.