Digital services from cloud storage and enterprise software to fintech and media streaming are becoming the new flashpoints in global trade tensions, a new Boston Consulting Group (BCG) report reveals. While tariffs on goods often dominate headlines, services are quietly shaping the future of global competition.
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According to the report, Services Are the New Fault Lines in Global Trade, the global services market is set to grow 5.6% annually through 2032, reaching $11.7 trillion twice the growth rate of goods. But with this growth comes heightened exposure to policy disruptions, ranging from data localization rules to outright platform bans.
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“Services are now at the center of geopolitical competition,” said Aparna Bharadwaj, senior partner at BCG. “Companies must build resilience as nations increasingly use regulation and restrictions to assert control.”
As services account for up to 70% of GDP and 50% of jobs worldwide, the stakes are high. Leaders in the space the US, UK, India, and Ireland are driving growth but also face significant risks from policy retaliation.
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BCG recommends companies adopt a three-pronged approach: anticipate regulatory changes, build flexible business models to cushion financial exposure, and adapt operations for market-specific agility.
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