doi.org/10.52340/eab.2025.17.02.05

The article analyzes the process of deglobalization, focusing on the trends of geo-economic fragmentation caused by deglobalization. It argues that geo-economic fragmentation intensifies geopolitical and economic tensions, posing significant challenges to the growth of global businesses - particularly small and medium-sized enterprises (SMEs). In this context, the article highlights the importance of identifying both the positive and negative impacts of geo-economic fragmentation on small and medium-sized businesses, exploring the challenges and opportunities it presents, and examining strategies for adapting to the emerging economic landscape. To address these concerns, the following research questions have been formulated:
RQ1: What are the historical evolution and current trends in the study of geoeconomic fragmentation?
RQ2: What are driving factors behind geoeconomic fragmentation?
RQ3: How does geo-economic fragmentation influence the development of small and medium-sized businesses?
RQ4: What challenges does geo-economic fragmentation pose to the development of small and medium-sized businesses?
RQ5: What can geo-economic fragmentation offer for small and medium-sized businesses?
RQ6: What future scenarios could unfold for small and medium-sized businesses and their collaboration with international organizations in the context of geo-economic fragmentation?
RQ7: What challenges does multilateralism face at the current stage, and what potential opportunities exist for its future development?
Based on a bibliographic reviw, this research identifies the theoretical and empirical foundations of the problem, assessing the impact of geoeconomic fragmentation on international trade and investment flows. The literature review confirms the influence of the deglobalization process on small and open economies, such as Georgia. The findings emphasize the positive role of globalization while evaluating both the advantages and drawbacks of deglobalization. Amid the challenges of geo-economic fragmentation, the vulnerability of small and medium-sized businesses is substantiated. The literature review highlights the importance of aligning national economic policies with deglobalization trends, factoring in local socio-economic dynamics.
At present, the repercussions of geoeconomic fragmentation on the development of small and medium-sized businesses are becoming increasingly evident. To fully understand this phenomenon, the study assesses the evolution of geoeconomic fragmentation and analyzes its key determinants. Additionally, geoeconomic fragmentation is examined through technological, political, and social factors.
A quantitative study was conducted to explore the challenges and opportunities presented by geo-economic fragmentation and to evaluate its impact on the development of small and medium-sized businesses. The study surveyed 385 respondents via a Google Form online questionnaire, with participants representing 16 countries, including Georgia, Italy, Argentina, Turkey, Poland, USA, Germany, France, Ukraine, Malta, Taiwan, Greece, Azerbaijan, Russia, Australia, and Armenia. A descriptive analysis of the survey results was performed. The questionnaire employed various question formats, including multiple-choice, alternative, and scale-based questions, as well as nominal and dimensional scales. It comprised sections on identification, competency, practical application, and evaluation at both global and firm levels. Respondents were also invited additional insights through open-ended and discussion-based questions.
The survey results shed light on the main challenges facing the global economy and threats to global trade. They also assess the collaboration methods of small and medium-sized businesses with international organizations such as the WTO and IMF. Furthermore, the study identifies government support measures for small and medium-sized businesses in the context of geo-economic fragmentation, emphasizing the development of multilateral trade relations.
Quantitative research has revealed the challenges facing small and medium-sized businesses amid geoeconomic fragmentation, highlighting issues at both global and firm levels. At the global level, the main economic challenges include geoeconomic and geopolitical instability (43.6%), inflation (24.7%), difficulties in penetrating large markets (11.2%), supply chain disruptions (8.6%), protectionism and limited access to foreign markets (4.6%), among others.
In the context of geo-economic fragmentation, the primary challenge for SMEs in general is global trade problems. Specifically, supply chain disruptions and the increasing influence of the state on the economy were identified as the most significant threats by SMEs (23.9%). Additionally, 22.9% of respondents cited conflicts between economic blocs as a major threat to global trade, 18.4% pointed to supply chains problems,, and 14.0% highlighted the consequences of unilateral economic sanctions. Other identified threats included fragmentation of regulatory frameworks, rising protectionism, and related challenges. Open-ended survey responses further revealed both positive and negative impacts of global sanctions on small and medium-sized businesses. In the context of the positive impact, migration driven by sanctions led to increased demand in the housing construction market, businesses operating in the national market reported no significant changes in sales. However, the negative impacts were far-reaching, including decreased inventories and sales, limited export volumes of local products to international markets, rising prices for raw materials and supplies, and inflation-related cost increases. Moreover, supply chains disruptions created challenges in delivering products to both local and international markets, while the number of local and international tourists declined. Georgia’s heavy reliance on imports due to raw material shortages further exacerbated the negative impacts of geo-economic fragmentation on business.
The article emphasizes the key priorities within the multilateralism process, including the development of global digital trade rules, the establishment of an agenda by the WTO to support small and medium-sized businesses, increasing the volume of aid to developing countries on multilateralism-related issues, enhancing the efficiency of appellate institutions, reducing dispute resolution times, and other essential measures.
In conclusion, the paper presents future scenarios of geoeconomic fragmentation and offers recommendations to address the associated challenges.

Keywords: Deglobalization, geoeconomic fragmentation, global business, small and medium-sized businesses, multilateralism.
JEL Codes: F02, F13, L26, O19, R21, D22

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