Europe emerges as business safe haven in era of rising geopolitical risks Opinion piece by POLITICO

As geopolitical tensions increasingly disrupt global trade and investment, businesses are finding themselves on the front lines of international conflicts, according to a recent opinion piece published by Politico. The article, written by Elisabeth Braw, a senior fellow at the Atlantic Council, argues that Europe is becoming an increasingly attractive destination for companies seeking stability in an uncertain world.

Braw begins by highlighting the predicament of commercial vessels stranded in the Persian Gulf amid tensions surrounding the Strait of Hormuz. While ship crews face immediate disruptions, she contends that their experience reflects a broader reality confronting businesses worldwide: geopolitical disputes can rapidly affect commercial operations, supply chains and investment decisions.

Braw notes that executives at a recent global real estate conference repeatedly described Europe as a "safe haven" for investment. She argues that long-term investors increasingly value political stability, legal certainty and predictable governance, factors that she believes are becoming scarcer in many parts of the world.

A central theme of the commentary is the importance of the rule of law. Citing data from the World Justice Project's Rule of Law Index, Braw points out that nearly 70 per cent of countries experienced declines in rule of law in 2025. She links this trend to growing authoritarianism and argues that businesses depend on reliable legal systems to make investment decisions and manage risk.

According to the rankings referenced in the article, European countries dominate the top positions for rule of law, with Denmark, Norway, Finland, Sweden, Germany, Luxembourg, Ireland and the Netherlands among the leading performers. Braw argues that this legal and institutional stability provides Europe with a significant competitive advantage.

The Politico commentary also highlights findings from the latest Political Risk Survey conducted by insurance broker Willis Towers Watson. According to the survey, multinational companies are increasingly concerned about rising trade barriers, political polarisation and so-called "gray-zone" attacks — hostile actions by states that stop short of military conflict.

Braw notes that 65 per cent of surveyed companies reported being affected by tariffs, while many also cited the economic consequences of the war in Ukraine, tensions between China and Western countries, and other geopolitical disputes. The survey further found that the United States ranked as the country where businesses suffered the largest financial losses linked to political risk, ahead of China, Russia, Ukraine and India.

Another key finding highlighted in the article is the growing concern among companies about the foreign policies of their home governments. According to the survey cited by Braw, nearly four out of five respondents said their firm's overseas operations faced at least a moderate level of risk stemming from actions taken by their own governments.

Braw argues that European countries generally rely more on diplomacy than confrontation in international affairs, which she suggests may reduce the likelihood of retaliation against companies based there. However, she acknowledges ongoing security concerns, particularly regarding Russia's actions toward neighbouring European states.

Concluding her commentary, Braw argues that businesses can no longer assume they will remain insulated from geopolitical disputes. As tensions continue to reshape global commerce, companies must incorporate geopolitical risk into their planning and prepare for scenarios that could disrupt operations. Those that anticipate potential challenges will be better positioned to navigate an increasingly unpredictable international environment.

By Sabina Mammadli