Deep Dive into the concept of Partnership-Based Industrial Policy – Part 2: Geo-Economic Alliances
Industrial policy is increasingly shaping the global economy. But there is a fundamental problem: while governments design industrial strategies at the national level, the industries they seek to build operate through deeply international networks of supply chains, innovation ecosystems, talent flows, data infrastructures, and markets.
In this second part of the deep dive on partnership-based industrial policy, I explore why national industrial policy alone may be insufficient in an interconnected world—and why geo-economic alliances could become one of the defining policy innovations of the coming decades.
The episode examines the risks of an uncoordinated industrial policy era, including subsidy races, trade fragmentation, competing technological standards, and growing inequalities between major powers and developing economies. It argues that many countries simply lack the fiscal resources, technological depth, market size, or geopolitical leverage to compete alone.
The episode covers:
• Why modern industrial ecosystems are fundamentally international
• The limitations and unintended consequences of purely national industrial policies
• The growing risks of subsidy races, economic fragmentation, and technological blocs
• Why emerging economies face particular challenges in the new industrial policy landscape
• Lessons from Airbus and other examples of coordinated industrial development
• The emergence of a third pillar of economic security: Partnering
• How industrial alliances can strengthen protection, promotion, and innovation simultaneously
• Why Europe and the Global South have a growing convergence of interests in industrial cooperation
The episode then explores what partnership-based industrial policy could look like in practice through a detailed overview of different partnership models:
• Supply chain partnerships
• Production partnerships
• Demand and procurement partnerships
• Innovation partnerships
• Data partnerships and trusted data spaces
• Talent partnerships and shared skills ecosystems
• Standards and regulatory partnerships
• Financial partnerships and joint investment mechanisms
• Resilience partnerships for economic security
Finally, the episode argues that international cooperation itself must adapt to the realities of a geo-economic world. Economic security, industrial capabilities, technology development, innovation systems, and strategic value chains are becoming increasingly central to international partnerships.
The key message is simple:
Partnerships can no longer be treated as an add-on to economic policy. If industrial policy is becoming one of the defining instruments of geo-economic competition, partnerships must become a core operating principle of economic security and industrial strategy.
The future may not belong to those who spend the most on industrial policy—but to those who build the strongest alliances.
World.OS – Rethinking International Cooperation in a Multiplex World explores how economic security, technology, industrial strategy, and international cooperation are reshaping the global order.
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