The planet’s original business travellers, the Four Horsemen of the
Apocalypse, could be in for a busy 2025. If that sounds hyperbolic, consider
this doom-laden introduction to the Risk Outlook 2025, published by travel risk
management company International SOS (ISOS).
“The relative geopolitical
stability that has held since the dismantling of the former Soviet Union has
now fractured,” writes chairman and CEO Arnaud Vaissié. “Conflicts in the
Middle East and between Russia and Ukraine have shaken the world. Unrest and
polarisation are rife. Extreme weather events and resource scarcity further
fuel instability. The prevalence of infectious diseases adds another layer of
concern.”
The ISOS publication includes a
survey of senior risk professionals, with 65 per cent believing risks have
increased over the past year and 69 per cent predicting significant impacts
from geopolitical challenges in 2025.
Not the least of those challenges
is the return to the US presidency this week of Donald Trump. Having already
threatened, among much else, tariffs and military action against traditional
allies, an inflection point has seemingly arrived. “The shifting geopolitical
environment will have a massive impact on business travel for certainly the
next four years,” ISOS regional security director for northern Europe James
Wood tells BTN Europe.
Ironically, the volatility of
the Trump presidency arrives just when “the underlying theme is good news for
business travel. The economics are turning in the right direction,” says Mike
Eggleton, director of research and intelligence for BCD Travel. After the
shocks of Covid and the Ukraine war, inflation has moderated, as have interest
rates, thus stimulating consumer confidence, business investment and,
consequently, corporate travel.
The question is whether the current
benign conditions for business travel will hold firm in the intensifying geopolitical
turbulence. The likely answer falls broadly into four categories: “weaponised
uncertainty”, doors shutting, doors opening, and personal risks for travellers.
“Weaponised uncertainty”
This is a phrase coined by
Meredith Crowley, professor of economics at the University of Cambridge, to
characterise Trump’s modus operandi. Volatility, in other words, is not
an accidental byproduct of his actions; it is a deliberate strategy to
disadvantage perceived rivals.
Will that unpredictability inhibit business travel? Another 2025
outlook, this time from consultancy Control Risks Group (CRG), labels the USA as the
“Uncertain States of America”. According to CRG CEO Nick Allan, “despite the
competitive and fractured state of geopolitical relations, the world remains
globalised and economically interconnected in ways that mean avoiding
turbulence is not an option… A world where the perception of risk is too high
is a world where international firms are often reluctant to expand and explore
and where they may sit on their hands to see which way the wind blows, or if
the storm will subside.”
One country where businesses are already facing this dilemma is Denmark,
threatened, extraordinarily, not only with tariffs but even military action by
Trump if it refuses to cede control of Greenland to the USA.
Danish Business Travel Assocation general manager Jen Søndergaard believes
tariffs will not materialise, partly thanks to “all for one, one for all”
support from the European Union. However, “it’s more the uncertainty which
would make companies look at their strategies and decide whether to be cautious
or go ahead as if nothing has happened,” he says.
Unpredictability has other consequences for business travel. One is the
need to stay alert for sudden, untrailed lurches in policy. “It could be a 4am
Tweet and suddenly Indian travellers have to go through additional security
screening. It really could just be announced by Tweet,” says Riskline risk
analyst Paul Mutter.
Uncertainty will also be amplified by the tsunami of misinformation that
makes it harder to spot where true risks lie, a challenge compounded by social
media providers removing their fact checkers, according to Wood. The risk is
that employers and their travelling employees could end up with different views
of what constitutes truth.
“In the main, people are able to discern
misinformation,” he adds, but “different generations in the workplace have
different views on veracity, corroboration of information, and the utiilisation
and sourcing of that information. This is an issue that organisations need to
face up to.”
Doors closing: tariffs and travel bans
International business travel has
thrived on decades of economic globalisation fuelled by free trade. Now, says
the ISOS Risk Outlook, “countries are becoming more inward-looking, driven by
rising nativism and the pressures of populism and protectionism. This trend
will lead to policies focused on bringing industries back home, prioritising
national resources, and tightening border controls, which will affect
immigration, trade, and industrial strategies.”
Rather than much-discussed tariffs, it is those
tightening border controls which could prove most immediately and directly
consequential for business travel. “USA entry restrictions could be tightened
considerably as per last time round,” says Mutter. The most
likely indicator of which countries will be targeted are those that “have
already been publicly identified by the incoming administration as uncooperative
on certain issues, which includes the USA’s biggest trade partners Canada and
Mexico. China and India are also very likely to be affected from early on.”
If Trump does increase tariffs, retaliation
in kind can be expected. The potential to chill trade and travel between the
countries involved is obvious but the reality may be more complicated.
Companies may elect to continue exporting to the USA even with tariffs, and in
the short term, says Eggleton, “when you start increasing regulation, that
sometimes means there is more need to travel to have face-to-face meetings with
officials and others.”
A different concern is the potential for tariffs to increase travel
costs, especially when visiting the USA. This is already happening. Tariffs fuel
inflation (as could Trump’s anticipated tax cuts), which might force up US
interest rates. These fears are keeping the dollar high against other
currencies. Should tariffs be introduced, the dollar would be turbo-charged by
other countries depreciating their currencies to offset the increased price of
their exports.
The US is no longer the leader in world trade. 120 countries or so have China as their major trade partner”
Doors opening: new trade flows
In November 2024, the BRICS grouping of increasingly powerful
non-Western nations (Brazil, Russia, India, China, South Africa) enlarged to
become BRICS+, now also including Egypt, Ethiopia, Iran and the United Arab
Emirates. Saudia Arabia may also join. Together, they repesent 45 per cent of
the world’s population and 35 per cent of global GDP based on purchasing power
parity, according to a briefing published by the House of Commons Library.
David Henig, director of UK Trade Policy Project, recently told the BBC:
“The US is no longer the leader in world trade. 120 countries or so have China
as their major trade partner.” CRG’s outlook concurs. “US global power is in
relative decline,” it says. “Countries have other options for borrowing money,
trading goods and buying tech.”
With more trading options available in an increasingly multi-polar
world, “companies that pull out of the US market will go elsewhere,” says
Eggleton. He does not believe tariffs will reduce the flow of trade and travel
overall but will instead make it flow in new directions.
Eggleton expects increased business travel from Europe to India in
particular, but also China, Vietnam and perhaps Africa, a continent similarly identified
for trade growth by Wood, who names two other likely winners. “Türkiye and
Saudia Arabia are playing a more muscular geopolitical role within their region,”
he says. “I think their trade routes will open up as well.” The recent dewesternisation
of the former’s name appears highly symbolic of this growing self-confidence.
Travelling to a more diverse set of destinations means “the complexity
of travel will change going into 2025 and beyond,” says Wood. Two obvious
examples travel managers will need to navigate are visa and vaccination
requirements.
Proliferating risks for travellers
Every year ISOS publishes national security risk level ratings. For
2025, not one country has had its risk level reduced. With different members of
the United Nations Security Council backing different sides in conflicts around
the world, intractable military confrontations look set only to intensify. Such
conflicts threaten foreign workers in sectors like energy.
Regular business travellers are less in danger, but do face disruptions.
Western airlines, for example, were already avoiding Russian airspace.
Following the suspicious downing of an Azerbaijan Airlines aircraft over
Kazakhstan on Christmas Day, they are now extending cancellations in the region
and steering clear of even larger swathes of the Former Soviet Union, says
Mutter.
And while airlines are gradually returning to the Middle East, “that
again could change. The incoming US administration has vowed to take a much
harder line on Iran,” Mutter says. If that takes the form of military conflict,
“that would be very bad for the Gulf state hubs. They would have to very
significantly reroute traffic and worry their airports could be attacked by
drones. That would be a real disaster for the industry.”
Business travellers face other risks besides. Recent fires in Los
Angeles and floods in Valencia demonstrate the growing likelihood of being
caught in environmental disasters even in Western countries.
Meanwhile, ISOS warns of the return of infectious
diseases that had largely been in abeyance through vaccination, including
polio, typhoid, measles and whooping cough. The accompanying epidemic of vaccine
scepticism is one reason these diseases have spread, and are an example of the
kind of disinformation employers might have to fight if they try to step up
vaccinations of their travellers.