As the global economy turns toward 2026, policymakers and businesses are no longer debating when the next crisis will arrive. Instead, the defining assumption is that disruption is permanent. Trade fragmentation, persistent inflationary pressures, geopolitical rivalry, and climate-related shocks, trends that hardened in 2024 and 2025, are now structural features of the global system rather than temporary deviations.
Economists increasingly describe this environment as a permacrisis, “permanent crisis”: a prolonged period in which overlapping risks constrain growth without triggering a single, decisive collapse. For African economies and firms embedded in global trade, the question for 2026 is not how to restore the pre-pandemic order, but how to function and remain competitive within a fractured one.
The most visible channel through which this permacrisis operates is trade. Over the past two years, advanced economies have turned more openly toward protectionist tools, tariffs, subsidies, export controls, and industrial policy to secure supply chains and strategic industries.
In practice, this has produced what analysts describe as “managed fragmentation.” Global trade has not collapsed, but it has become slower, costlier, and more politically mediated. For African exporters, this means higher compliance costs, shifting market access rules, and growing pressure to align with competing regulatory regimes.
Take automotive and battery supply chains. As the United States and European Union impose stricter rules on electric vehicle subsidies and sourcing requirements, African producers of critical minerals such as lithium, cobalt, and manganese face new opportunities and constraints. Countries like the Democratic Republic of Congo and Zimbabwe benefit from sustained demand, but processing and value addition remain concentrated outside the continent, limiting the broader economic payoff.
Winners and Losers in the Permacrisis
Not all actors lose equally in this environment. Countries and firms that control strategic inputs or logistics corridors are better positioned. Morocco, for example, has leveraged its proximity to Europe and trade agreements to attract investment in automotive manufacturing and renewable energy components. Similarly, Egypt has benefited from its role as a logistics hub, even as Red Sea disruptions have raised global shipping costs.
At the firm level, larger companies with diversified supply chains and access to capital are adapting faster. A Nigerian consumer goods manufacturer sourcing packaging inputs from both Asia and Eastern Europe is better insulated from tariff shocks than a smaller competitor dependent on a single supplier.
By contrast, small and medium-sized enterprises across Africa are bearing disproportionate costs. Higher freight rates, volatile exchange rates, and tighter global financing conditions have eroded margins. For many SMEs, trade fragmentation translates into delayed deliveries, reduced export competitiveness, and higher working capital requirements.
Where Implementation Has Stalled
While governments increasingly acknowledge the need for adaptation, implementation gaps remain significant. Regional integration initiatives, including the African Continental Free Trade Area (AfCFTA), were designed to cushion African economies against external shocks by boosting intra-African trade. Yet progress has been uneven.
Customs harmonisation, rules-of-origin clarity, and trade finance infrastructure lag behind political commitments. As a result, African firms often find it easier to trade with Europe or Asia than with neighbouring countries. In a fragmented global economy, this represents a missed strategic opportunity.
Industrial policy is another area where ambition has outpaced execution. Many African governments have announced plans to move up value chains in agriculture, minerals, and manufacturing. However, inconsistent energy supply, limited transport infrastructure, and regulatory uncertainty continue to deter large-scale investment.
Inflation, Interest Rates, and Business Strategy
Inflation remains another pillar of the permacrisis. Although price pressures have eased from their 2022–2023 peaks, they remain elevated by historical standards. Central banks in the United States and Europe are expected to cut rates gradually in 2026, but borrowing costs are unlikely to return to the ultra-low levels that defined the previous decade.
For African businesses, this means operating in a high-cost environment for longer. Firms are responding by prioritising pricing power, cost control, and operational efficiency. In Kenya and South Africa, for instance, retailers have shifted toward smaller package sizes and local sourcing to protect demand and margins.
Capital allocation decisions are also changing. Companies are more cautious about expansion financed through debt and more focused on projects with faster payback periods. This conservative stance may dampen short-term growth but reflects rational adaptation to uncertainty.
Risks to Watch and Emerging Opportunities
The risks to this outlook are asymmetric. A sharper escalation in trade tensions, such as widespread export controls or aggressive subsidy races among G7 economies, could disrupt African exports more severely. Political instability and election cycles in key economies also pose fiscal and currency risks.
Yet opportunities exist alongside these threats. Defence-related manufacturing, renewable energy, logistics, and food processing are attracting increased investment as governments and firms seek resilience. In Ghana and Senegal, for example, agribusiness firms are investing in local processing to reduce exposure to volatile import markets.
Realistic Expectations for Businesses in 2026
For African businesses, the lesson of the past two years is clear: waiting for global stability to return is no longer a strategy. The most resilient firms are those that treat geopolitical and policy signals as core business inputs, not external noise.
In 2026, success will depend less on forecasting a single economic outcome and more on maintaining strategic flexibility, diversifying suppliers, hedging currency risk, and engaging proactively with policymakers. The global economy may remain fractured, but within that fragmentation lie pathways for adaptation, growth, and selective advantage for those prepared to navigate the permacrisis rather than resist it.
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