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Middle East conflict: How geopolitical risk is reshaping data center resilience and investment

According to Marsh’s Political risk report 2026, governments are increasingly viewing digital infrastructure through a zero-sum lens and the consequences are already visible. In the Middle East, three Amazon hyperscale data centers were reportedly targeted by drone strikes amid escalating conflict — forcing them offline and disrupting banking, payments, and enterprise software across the region. This deliberate targeting sends a stark signal that digital infrastructure is a strategic asset and potential target in geopolitical conflicts.

In today’s complex geopolitical landscape, data centers and digital infrastructure can no longer be evaluated solely on technical or operational criteria. Geopolitical risks now permeate strategic planning, investment decisions, supply chain management, and stakeholder relations.

To safeguard critical assets, protect investment and ensure operational resilience, organizations should adopt a comprehensive approach encompassing the following key actions:

1) Integrate geopolitical risks into all aspects of business planning

Organizations that build a shared view of geopolitical risk across leadership teams and integrate it early into planning, operations, and enterprise risk management (ERM) frameworks are more resilient and better positioned to act with clarity in uncertain conditions. This can be a leverage to ensure first-mover advantage in a highly competitive landscape. 

Businesses that assess geopolitical shifts proactively in their risk strategy are more likely to identify emerging opportunities, avoid downside risks, and align long-term plans with stakeholders before conditions tighten.

Advanced analytical models, like Marsh Risk’s World Risk Review, can help organizations narrow the field of potential conflict risks and enable more strategic resource allocation.

2) Build flexibility into trade, supply-chain, and financing decisions

As geopolitical competition reshapes global trade, established relationships are becoming less predictable. Businesses may find access to new customers or suppliers, but these gains often come with greater exposure to non-payment, default, or contractual failure.

Building flexibility into trade, supply-chain, and financing decisions is therefore critical. This may involve reconfiguring supplier networks, diversifying counterparties, and using risk-transfer solutions such as trade credit, business interruption (BI), and structured credit insurance to manage exposure. 

Data-driven tools such as Sentrisk can provide real-time visibility of supply chains, helping organizations anticipate and respond immediately and more effectively to geopolitical disruption.

3) Protect investments from conflict and political risk

As digital infrastructure becomes a strategic target, protecting physical and financial assets is increasingly critical. Insurance plays an important role in protecting against risks that are difficult to predict or control including political violence and state intervention to cyber incidents and project delivery challenges. This is most effective when combined with scenario planning and a broader view of risk across assets, counterparties, and jurisdictions.

Businesses should consider how geopolitical risk, cyber exposure, and performance-related risks interact and structure coverage accordingly, including the use of:

  • Political violence insurance: Responds to physical damage, operational shutdown losses, and resumption expenses, allowing operations to continue with acknowledged risk alongside resilience and crisis response plans.
  • Political risk insurance: On top of protecting investments from security, investment, currency, or regulatory risks, S&P Marsh Risk Research shows that this coverage can address internal rate of return (IRR) shortfalls and facilitate more favourable financing terms.
  • Cyber insurance: Addresses growing cyber threats targeting critical infrastructure.
  • Surety bonds and performance guarantees: Provide assurance on contractor performance and reduce execution risk.
  • Valuations and BI reviews: Crude price volatility and supply chain disruption are impacting asset and BI values, risking underdeclared sums. Shortfalls in claims payouts can be mitigated through valuations, BI reviews and claims support.

Why Marsh?

Our global political risk team has placed US$350 billion in coverage for political risk and structured credit clients and includes more than 150 colleagues across 28 countries. We combine deep geopolitical risk expertise with integrated digital infrastructure solutions, helping organizations assess exposure, protect investments, and navigate an increasingly complex operating environment. Marsh also produces insights on macro risk trends and political risk trends, including our Political risk report.

Speak to a Marsh advisor to learn more about protecting your digital infrastructure and data centers.

Our people

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Larry Liu

Communications, Media, and Technology (CMT) Industry Leader, Marsh Risk Asia

  • China

Christopher Coppock

Christopher Coppock

Head of Geopolitical and Economic Risk Analysis, Credit Specialties Marsh Risk

  • United Kingdom

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