The End of Rules-Based Order? Davos 2026 Reveals a World Choosing Bargains Over Principles

The most powerful people in the world gathered at Davos 2026, but they weren't talking about building a better future. They were conducting a post-mortem on the international order that has governed global affairs for decades.

What emerged from the Swiss Alps wasn't hope for renewed cooperation, but a stark acknowledgment that the rules-based international order is dead. In its place, a new reality is taking shape—one where bargains matter more than principles, where sovereignty is conditional rather than absolute, and where power determines which rules apply to whom.

President Trump's blunt approach to international relations crystallized this shift. His message was clear: territorial questions like Greenland aren't legal absolutes but "negotiable strategic assets." Tariffs, deals, and leverage—not international law—are the primary tools of modern statecraft. Sovereignty, in this worldview, isn't a birthright but something earned and defended through capability.

The Great Divergence: Three Visions of Order

The forum revealed that there's no longer a unified Western position on how the world should work. Instead, three distinct visions emerged, each shaped by different priorities and fears.

America's instrumental approach treats international order as a byproduct of successful deals. NATO becomes a negotiable arrangement tied to burden-sharing rather than a sacred alliance. Ukraine transforms from a principle worth defending into a problem to be "settled." This isn't isolationism—it's transactional globalism where everything has a price.

Europe's response has hardened into something resembling strategic defiance. Ursula von der Leyen and other European leaders insisted that sovereignty and borders remain non-negotiable foundations. Emmanuel Macron warned against descending into a "law of the strongest," while Germany's Friedrich Merz bluntly acknowledged that great-power politics now endangers smaller states.

For Europe, the lesson is clear: principles without power are worthless. The continent is rapidly building what officials call "strategic autonomy"—defense industrial capacity, anti-coercion instruments, and economic tools to defend its vision of order materially, not just rhetorically.

Asia's vision proved more nuanced. China's Vice Premier He Lifeng positioned Beijing as a defender of globalization and multilateral cooperation, warning against zero-sum thinking. Yet China's language on sovereignty remained deliberately abstract, avoiding Western interpretations of conflicts like Ukraine while emphasizing "respect and non-coercion."

This ambiguity isn't accidental. It allows China to present itself as a "steady pole" amid transatlantic chaos, benefiting from perceptions of Western incoherence without committing to anyone else's red lines.

When Sovereignty Becomes Conditional

Perhaps the most consequential revelation from Davos was that sovereignty itself has become contested terrain. Not in definition, but in application.

Ukrainian President Volodymyr Zelenskyy captured this anxiety perfectly, arguing that peace cannot mean trading away sovereignty. His reference to a "Greenland mode" wasn't subtle—he was warning that passivity in one context creates vulnerability everywhere else.

Canadian Prime Minister Mark Carney went further, arguing that the transactional turn marks the effective end of the rules-based order as it once functioned. The danger, he suggested, lies not just in great power assertiveness but in the absence of organized resistance by middle powers.

The paradox is striking: everyone at Davos claimed to defend sovereignty, but not everyone agreed on when it could be bent. Trump's America sees sovereignty as conditional on security capability. Europe treats it as indivisible. China keeps its interpretation deliberately vague.

This unresolved contradiction explains why so many participants acknowledged, often tacitly, that the old order no longer exists as shared consensus.

The Space Between Chaos and Rules

What's replacing the rules-based order isn't pure anarchy. Instead, we're entering what might be called a "selective compliance" system—one where there are rules for some issues and bargains for others, where norms persist while being continually tested by power.

This hybrid order creates both risks and opportunities. For Europe and Asia, the breakdown of universal rules might actually enable deeper cooperation. Europe's push for strategic autonomy doesn't mean decoupling from Asia—it demands more engagement in the name of diversification.

Europe-India cooperation stands out as particularly promising, anchored in shared concerns about coercion and supply chain resilience. India's strategic autonomy aligns more comfortably with Europe's search for balance than with binary bloc thinking.

Europe-China engagement remains more complex. While economic cooperation and climate coordination are unavoidable, divergent interpretations of sovereignty—especially regarding Ukraine—limit deeper strategic trust.