The tensions between the United States (US), Israel, and Iran are not just another geopolitical confrontation-they are a reminder that globalisation, for all its scale, still runs through a narrow set of fragile chokepoints. The Strait of Hormuz, once again in focus, carries roughly one-fifth of the world's oil supply-around 20 million barrels per day. A disruption here would not be regional; it would be systemic.
But the real story is larger-and more unsettling. Vulnerability in an integrated world is no longer simply maritime.
Today's chokepoints are embedded deep within the architecture of the global economy. More than 90 per cent of advanced semiconductors are manufactured in Taiwan, with a single company dominating global foundry capacity. In critical minerals, China controls nearly 60 per cent of mining and up to 85-90 per cent of refining of rare earths. Meanwhile, over 95 per cent of global data flows through roughly 500 subsea cables, many converging at a limited number of landing points.
This is not just interconnection. It is concentration.
What appears as efficiency in peacetime is, in reality, dependency in disguise. Over three decades, globalisation has been engineered to minimise cost and maximise speed-systematically trading away redundancy, geographic diversity, and strategic slack. The result is an architecture that is highly efficient, but structurally brittle.
These systems are not merely connected-they are mutually load-bearing. A disruption in one node does not remain contained; it propagates outward. The warning signs are already visible. The 2021 blockage of the Suez Canal disrupted nearly 12 per cent of global trade, costing an estimated $9-10 billion per day. The war in Ukraine triggered energy and food shocks that reverberated globally, pushing food prices to near-record levels in 2022. What begins as a localised disruption quickly becomes a systemic shock.
Chokepoints expose the operating logic of globalisation itself. Decades of industrial concentration, supply chain optimisation, and infrastructural centralisation have quietly accumulated systemic risk. The system did not arrive here by accident; it was built this way.
What makes this moment particularly dangerous is not just the existence of chokepoints, but the ease with which they can now be weaponised.
Disruption is no longer confined to missiles and blockades. It now includes cyberattacks, export controls, sanctions, regulatory pressure, and climate stress. Semiconductor restrictions have already shown how supply chains can be constrained without kinetic conflict. Climate-induced droughts affecting the Panama Canal-through which about 5-6 per cent of global trade passes-illustrate how environmental shocks can function as chokepoints in their own right. Increasingly, these tools are deployed in combination.
In a tightly coupled system, effects are rarely linear. They are cascading, compounding, and difficult to reverse. Disruptions to shipping lanes, mineral flows, chip production, or digital infrastructure can trigger energy shocks, freight dislocation, inflationary pressure, financial instability, and digital fragility across continents. The chokepoint targeted today may be the crisis felt elsewhere tomorrow.
The uncomfortable reality is this: globalization has not eliminated strategic vulnerability-it has concentrated it.
Why, then, has the global system failed to adapt to risks it helped create?
Recent crises expose a deeper governance failure. Multilateral institutions, including the United Nations, were designed for an era when threats were slower, more localised, and easier to attribute. Today's risks are systemic, fast-moving, and often ambiguous. Yet decision-making remains slow, consensus-driven, and frequently paralysed by geopolitical rivalry.
The problem is not simply that institutions are weak-it is that they are mismatched to the nature of modern interdependence.
Compounding this is a structural blind spot: much of the infrastructure that defines these chokepoints-semiconductor fabrication, subsea cables, cloud systems, logistics networks-is controlled not by states, but by the private sector. Global governance frameworks have not kept pace. They regulate states in a world increasingly shaped by corporate infrastructure.
If chokepoints define the vulnerabilities of globalization, resilience must define its next phase.
Addressing this will require more than incremental reform. It demands three structural shifts.
First, strategic diversification. Countries must reduce dependence on single geographies or suppliers in critical sectors such as semiconductors, energy, and rare minerals. This will not be costless. Diversification implies higher production costs, duplication of capacity, and a partial retreat from hyper-efficient global specialisation. But the alternative is continued exposure to systemic shocks.
Second, resilience must be built in by design. Efficiency can no longer be the sole organising principle. Spare capacity, alternative routing, and regional buffers must be deliberately embedded into critical systems. This means moving beyond just-in-time models toward systems capable of absorbing disruption-through dual sourcing, diversified logistics networks, alternative energy corridors, and more robust digital infrastructure. Resilience, by definition, requires accepting a degree of inefficiency.
Third, multilateral cooperation must be reconfigured-not abandoned. Large, consensus-driven institutions are structurally too slow for managing chokepoint risk in real time. What is needed is a more flexible, layered approach: issue-specific coalitions focused on securing critical systems-semiconductor alliances, critical mineral partnerships, coordinated maritime security frameworks, and agreements to protect digital infrastructure.
At the same time, the rules-based order must be reinforced where it matters most. Freedom of navigation, protection of energy and digital infrastructure, and transparency in supply chains should be treated not as aspirational norms, but as enforceable commitments. This will require faster decision-making, clearer accountability, and structured collaboration with the private sector, which operates much of this infrastructure.
None of this will be easy. It requires governments to accept higher costs, firms to rethink efficiency-driven models, and institutions to abandon outdated assumptions about how the world works.
But the alternative is more dangerous.
The paradox of globalisation is now unavoidable. The same networks that have delivered unprecedented growth have also created concentrated points of failure. Efficiency has come at the cost of resilience; interdependence has come with hidden fragility.
The next crisis will not begin where it is ultimately felt. It will begin at a chokepoint-physical or digital, visible or obscure-and cascade through systems few fully understand but everyone depends on.
In that world, resilience is not simply an economic preference. It is the precondition for geopolitical stability.
Manmohan Parkash is a former Senior Advisor in the Office of the President and former
Deputy Director General for
South Asia at the Asian Development Bank (ADB). manmohanparkash@gmail.com
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