‍Opinion piece by Marcel Stalder, CEO of Chain IQ Group AG and President of Lucerne Dialogue

A World In Upheaval: The New Era Of Structural Instability

A key driver of today's disruption is the fundamental change in the global order: With the rise of China, the resulting rivalry with the United States, and the increasing nationalism placing national sovereignty above international cooperation, such as "America First", "China 2030", and "Brexit", we are moving away from multilateral cooperation toward a multipolar, power-driven system. A small number of dominant actors – most notably the United States, China, India, and Russia – are increasingly shaping global dynamics.

As the old world order is changing, conflicts are no longer regional, they are interconnected. War in Eastern Europe affects food markets worldwide, tensions in the Indo-Pacific reshape supply chains, and instability in the Middle East impacts energy markets globally, reverberating across financial systems. Each shock amplifies the others because there is no longer a unified framework to contain them.

At the center of today's turbulence stands artificial intelligence – not as a fleeting trend, but as a historic shift in how the world works. We have moved from an age of static tools to an era defined by global information flows. Today, we have entered the era of intelligence: a systemic transformation where AI is no longer a localized resource, but a planetary force. It permeates every sector of life and the economy – from the deep sea to orbital space – evolving faster than any regulatory framework can follow. Humanity has gained extraordinary capabilities, yet we still lack the shared rules and trust to govern a force that operates with such unprecedented speed.

Equally consequential are social divides: Information flows are no longer curated by traditional institutions but shaped by algorithms, emotions, and narratives resulting in declining trust, increasing polarization, and rising frustration, often described as "angry society". Social media and the digital sphere are lacking the accountability of the physical world. Platforms do not merely reflect these dynamics, they amplify them by prioritizing engagement over truth. To address this, we must establish the same standards for the online world as we have offline: Opinions in the digital public square must be identifiable, intellectual property protected, and the patterns of algorithmic influence made transparent. A shared foundation of objective facts is not a technical requirement – it is the backbone of democracy, ensuring that facts, rather than emotions, drive our collective decisions.

Climate change adds structural pressure to all of this. It is not an environmental issue alongside the others, it is a systemic risk multiplier that reshapes migration, infrastructure, agriculture, and economic stability – requiring massive investment under conditions of geopolitical fragmentation.

In this environment, complexity and upheaval become the defining feature. Risks are no longer linear or predictable. In financial markets, this effect is particularly visible: Prices are driven less by fundamentals and more by narratives, expectations, and the behavior of dominant actors. Capital moves faster than political systems can react, and crises are no longer exceptions but inherent features of the system.

The strategic implication for both Europe and Switzerland is clear: Resilience replaces efficiency as the central paradigm, as the old logic of optimizing for efficiency and stability no longer holds. What is required now is the capacity to perform under sustained pressure – leaner structures, more agile organizations, robust supply chains with offshoring being complemented by "friendshoring", as well as tighter cost discipline built into strategy rather than added as an afterthought. Resilience is no longer defensive. It is competitive and must be tackled proactively. Yet resilience alone is not enough – it must be paired with a genuine drive toward economic and military strength, supported by the population through a governmental system mirroring the societal structure.

Europe: From Peace Project To Strategic Power

Europe was built as a peace project. After the devastation of the 20th century, the logic of integration was unity through shared institutions, emphasizing commonality over division. That logic was highly successful and wise for its time, yet it is no longer sufficient for ours. This is because for decades, European strategy rested on the conviction that the power of values would be sufficient: that human rights, the rule of law, and social justice would constitute a geopolitical currency in their own right.

While these remain essential, in a world redefined by competition and hard power, that conviction alone is no longer enough. Europe has powerful values – but Europe has forgotten the value of power. The reality is that the value of power must now complement the power of values. Without the ability to act decisively – militarily, economically, technologically – values cannot be defended. This is not an argument for abandoning European principles, it is an argument for giving them teeth.

“Europe has powerful values – but Europe has forgotten the value of power.”

This shift from abstract values to tangible strength applies above all to the economic dimension – because without economic strength, no other form of power is sustainable. Europe has gradually lost competitive ground. While other regions have aggressively invested in innovation, digital infrastructure, and industrial transformation, Europe has often prioritized regulation and social balancing. Both matter, but the balance has tilted too far. Productivity, innovation, and entrepreneurial dynamism must return to the center of European policy. The mandate is clear: Europe must get back to business, as the backbone of any serious geopolitical actor is its economic strength.

“Back to business: The backbone of every superpower is its economic strength.”

However, economic dynamism cannot flourish under the current institutional weight. Today, Europe faces a paradox: too much centralization in the wrong areas, and too little in the right ones. Citizens experience the EU as a distant bureaucracy, yet in domains where collective action matters most –foreign policy, defense, energy – the Union remains fragmented. Europe spends more on defense than China, but with a fraction of the strategic impact. [1][2] The problem is not resources, it is the courage and will to act as a unified force.

The solution, therefore, is not more centralization, but a smarter allocation of responsibility. Europe, similar to Switzerland, must act collectively only where  indispensable – foreign policy, defense, energy, and the single market – while leaving social policy to member states and their citizens, allowing cultural identity to be preserved. A necessary move back to society means that the EU, as any resilient, enduring political entity, can only function if it reflects the nature of its population structure, which means honoring diversity rather than absorbing it into uniformity. Europe is not a nation-state: Its strength lies in its distinct histories and traditions, provided they are genuinely respected as the foundation of the European project.

“Back to society: The governmental system of any resilient, enduring political entity must reflect its underlying population structure – for Europe this means federalism and subsidiarity, not centralism.”

Another critical issue for Europe is leadership and decision-making capacity. Given the peace project legacy, decision-making processes are consensus-driven and slow. In a world of rapid change this becomes a strategic disadvantage. Stronger leadership – particularly from key countries such asGermany and France which carry particular responsibility within the European framework –  is necessary to drive integration and reform.

 At the same time, Europe must redefine its geopolitical role. It can no longer rely on external security guarantees and depend on the United States –the post-World War II era is over. However, the question is not either transatlantic alliance or isolation – there is a third way: strategic sovereignty based on a strong economy, strong defense capability, and a coalition centered on the EU, Canada, and other cooperative G20 democracies in order to act independently when necessary. This opens an opportunity tore-associate the UK as a European nuclear power to the EU, at least from a defense and security policy perspective.

“The third way: Europe must become more autonomous from the traditional transatlantic alliance through a coalition centered on the EU, Canada, and cooperative G20 democracies.”

Finally, Europe must rebuild internal cohesion. Social polarization, economic inequality, and increasing populism and nationalism threaten theUnion. The challenge is to balance economic competitiveness with social stability and integration with democratic legitimacy – the political change inHungary could be a start.

The question is no longer whether Europe needs to transform. It is whether Europe will choose to do so, or wait until the choice is made for it.

Switzerland: A Successful Model Under Pressure

Switzerland has long been seen as a model of success, combining political stability, economic strength, and social cohesion. Its decentralized system, strong institutions, and openness to global markets have created one of the most prosperous societies in the world. Yet Switzerland is not immune to the structural changes affecting Europe and the global system. In many ways, it is on the same trajectory as the European Union – only with a time lag.

One of the most worrying trends is a gradual shift toward an increasingly Swiss-centric and state-driven economy, undermining Switzerland’s traditional strengths. The fastest-growing sector in Switzerland is the administrative sector, while public spending is increasing more rapidly than the private sector. In addition, we are putting the backbone of the Swiss economy – industries such as financial services or the pharmaceutical industry– at risk by imposing national regulations on Switzerland-based companies that operate globally and require a level playing field with their international competitors.

At the same time, Switzerland, as an export economy, depends on international trade, yet the debate about its relationship with the EU reflects broader societal tensions.  A large portion of the Swiss population is neither clearly pro- nor anti-European trade agreement, as complexity and competing narratives have made it genuinely difficult for citizens to form clear positions. While the EU is often depicted as a “bureaucratic colossus”,official statistics suggest otherwise: Its administration, serving 450 million people, is comparable in size to the public sector of the Canton of Zurich. [3][4] Equally important,  Switzerland is not a small country vis-à-vis a huge EuropeanUnion: Compared to the 27 EU member states, it is the sixth largest economy, and half of the EU members have a smaller population than Switzerland.

The strategic imperative, however, is clear. Switzerland’s prosperity depends on open markets and stable economic relationships. Access to theEuropean single market is not optional – it is critical for both sides, asSwitzerland remains the EU’s fourth-largest trading partner, and the EU is by far Switzerland’s most significant. The path forward lies not in choosing between Europe and the world, but in pursuing both with equal conviction:securing the relationship with the EU through the Bilateral III framework while simultaneously deepening trade ties globally. This is not a contradiction but a necessity. In an interconnected world, independence relies on connectivity, not isolation, as sovereignty is built through relationships, not despite them.

“Switzerland should not confuse independence with isolation.”

To achieve this, Switzerland – much like the rest of Europe – must shift its focus. The goal is to move away from a primary reliance on macro-economic instruments and return to micro-economic fundamentals: productivity, innovation, infrastructure, and education. Only by strengthening these pillars can a meaningful macro-economic strategy be sustained.

At the same time, Switzerland must invest in its own resilience – from modernizing its armed forces and increasing defense spending to deepening security cooperation. In a world of hardening geopolitical lines, traditional neutrality must be recalibrated. Security cooperation – with European partners and international institutions – is no longer a compromise of sovereignty, it is a condition of it.

Lastly, the institutional trust that has long distinguished Switzerland from most of its neighbors remains a genuine asset – but it is under pressure, as it is everywhere. Preserving it requires transparency, democratic legitimacy, and the willingness to make difficult choices openly. That, too, is part of the Swiss model worth defending.

Strategic Clarity And Action

Europe and Switzerland are entering a new era – an era that is not defined by stability, but by continuous transformation. The structures that provided stability for decades – multilateral order, transatlantic security guarantees, efficient global supply chains, institutional trust – are all under simultaneous stress. In this environment, resilience becomes the central concept. It is not merely the ability to withstand shocks, but the capacity to adapt and perform under sustained pressure. For too long, a disproportionate focus on social welfare and chasing the zeitgeist have come at the expense of European and Swiss prosperity. The era of well-being as a strategy is over. Well-being is the result – prosperity, strength, and the will to act are the path. The moment that distinction is lost, decline begins quietly and accelerates fast.

“Well-being is not a strategy, it is at best a result.”

Ultimately, the defining factor is not structure, but mindset. It is time to act with the urgency the moment requires in a world that will not wait: For Europe, this means transforming from a peace project to a strategic power in a multipolar world. For Switzerland, as an export nation, this means securing access to international markets and defending independence based on connectivity rather than isolation, navigating values and power.

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