Global trade credit insurance provider Allianz Trade has, in its 'Sector Atlas 2026' report, concluded that a three-speed global economy is emerging, created by investment in AI, international political tensions and the fragmentation of supply chains. Overall, it expects the global economy to decelerate but still grow at 2.5% this year, and then recover next year and reach 2.9% growth.

“From a corporate risk perspective, the divergence between sectors is becoming increasingly pronounced,” pointed out Allianz Trade South Africa country manager Luke Morawitz. “Businesses serving long-term structural themes such as energy security, digitalisation, infrastructure and critical minerals are generally proving more resilient, while sectors exposed to cyclical demand fluctuations and margin compression face a more challenging outlook. The ability of South African companies to invest in productivity, embrace technology and strengthen their position within regional and global value chains will be critical to sustaining growth and competitiveness over the medium term.”

Globally, the most resilient sectors are those involved in, related to, or capable of benefitting from, AI, namely software and IT, pharmaceuticals and energy. The AI-linked technology sector is the main driver of growth, with infrastructure investments by the leading digital groups perhaps totalling $725-billion this year and growing to more than $1-trillion next year. AI investment is driving global semiconductor sales towards the $1.5-trillion mark. The pharmaceuticals sector is benefitting from applying AI to develop innovations and from the world’s ageing populations. Energy is benefitting because of the increasing demand for electricity to power the growing number of data centres as well as from greater cash flows created by increasing oil and gas prices.

At the other extreme, the three weakest sectors are automotive, textiles and fashion, and chemicals. The automotive sector is under pressure from Chinese competitors, which is cutting into prices and margins. Textiles and fashion are being squeezed by weak consumer demand and increasing costs. Regarding chemicals, it is particularly the European industry that is under pressure, as it suffers from an energy cost gap compared with other regions, most notably the US.

“South Africa exemplifies many of the trends highlighted in the Sector Atlas 2026. Sectors linked to structural growth drivers such as energy, technology, infrastructure, development and critical minerals are better positioned to navigate an increasingly fragmented global economy,” highlighted Morawitz. “The country’s mining value chain, particularly producers linked to metals that support electrification, renewable energy infrastructure and digital technologies, remains strategically important, while ongoing investment in energy infrastructure and digital transformation creates new opportunities for growth.”

However, South African companies in the automotive, textiles and certain other consumer-facing sectors face rising input costs, weak international demand and shifting global trade patterns. They must concentrate on operational efficiency, market diversification and innovation, in order to remain competitive.