Global business is entering what KPMG’s Stefano Moritsch calls a “geopolitical recession.” The changing rules of globalisation are driving companies to seek out stable, sophisticated jurisdictions where they can still manage risk and deploy capital. Increasingly, Mr Moritsch argues, that search leads to places like Bermuda.

“We are living through a geopolitical recession,” said Mr Moritsch, company’s global geopolitics lead, at yesterday’s annual meeting of the Chamber of Commerce, held at the Hamilton Princess and Beach Club. “The rules of the international system that underpin globalisation, that underpin global trade, global investment, are breaking down.”

That breakdown is visible everywhere, he said, from the war-disrupted Strait of Hormuz to the rising tariff walls between the United States and China. Supply chains that used to be efficient are now being re-examined. Companies are being forced to confront higher-for-longer inflation, costlier trade and decoupling in areas like critical minerals and advanced technology.

In that environment, Mr Moritsch argues, capital tends to flow towards jurisdictions that offer three things: stability, regulatory sophistication and deep expertise in cross-border structuring. That is where Bermuda enters the story as a practical solution. The island’s re/insurance, asset management and professional services sectors position it near the centre, he said.

“In a fragmenting world of increased and persistent volatility, capital and companies will look for little safe havens with critical advantages,” Moritsch says. “A risk capital hub like Bermuda is small, but global, with a pool of talent, diverse, dynamic and forward -looking with cross‑border structure and expertise.

“The more than we see regulatory complexity growing, because of failing international standards and regulations, the more that companies need to reckon with this increased complexity.

“And they need expertise to be creative, to be prepared for this new complex environment. It's an attractive proposition to come in a place like this.”

Globalisation was in retreat, he added.

“For the first time since the end of World War Two, we don't have a steady increase in trade openness,” Mr Moritsch said. “It all stems from this new geopolitical recession, but also from the fact that since the pandemic, we've seen the vulnerabilities of highly integrated, highly efficient — from an economic point of view — but vulnerable supply chains.

“Countries have imposed, on average, 3,000 additional trade restricted measures every year since the pandemic. And that's a dramatic policy shift compared to even 10 or 15 years ago, and so what we are witnessing is a whole paradigm shift.”

Economies would be rewarded for building intelligence, adaptability and optionality, he added, and seeing the business community, regulators and government officials in the same room yesterday gave him hope for the “amazing, dynamic ecosystem” that is Bermuda.