Partnerships are becoming the smarter route to global growth

In many markets, the reverse is now true. Companies are entering through partnership, learning fast, building selectively and keeping strategic options open until regulation, demand and supply chains become clearer.

That shift reflects a deeper change in the sector. Boards are being asked to grow across borders while carrying more uncertainty than at any point in recent memory. Commodity prices can move sharply. Permitting can stall for years. Trade routes can be redrawn by geopolitics. Local content rules can tighten with little warning. At the same time, the energy transition is creating new pools of demand, new technology pathways and new competitive pressure. The result is a simple but uncomfortable truth: many businesses need international reach, but fewer can justify committing capital in the way they once did.

Still, the appetite to expand hasn’t disappeared. HSBC’s The Business of Expansion research, found 77% plan to expand overseas in the next two years. What’s changing is how organisations want to do it. Expansion models that preserve flexibility are increasingly being treated as core strategy, not a contingency plan.

For senior decision makers, that makes partnerships and collaborations less a tactical choice and more a primary route to growth. Strategic alliances, joint ventures, franchising structures, licensing arrangements and other forms of shared-market entry are becoming essential tools for balancing ambition with control. In fact, the same research shows partnerships and collaborations are the most cited expansion model (50%), ahead of other approaches such as customer growth (48%) and product or service expansion (47%).

The opportunity set across the sector remains large. Power demand is rising in many regions, driven by electrification, data centres, industrial development and population growth. Critical minerals remain central to industrial strategy. Conventional energy still matters for security and affordability, even as low-carbon investment accelerates. New value pools are emerging in grid infrastructure, storage, carbon-related solutions, advanced materials and downstream processing.

Yet the route into those opportunities is more complex than the headline demand picture suggests.

Geopolitics is now shaping commercial decisions at an operational level. Businesses are not only asking where demand will grow, but where they can source reliably, move capital efficiently and operate with acceptable political and regulatory risk. Supply chains are being restructured around resilience as much as cost, and the research suggests that’s becoming a mainstream driver of cross-border strategy: supply chain resilience (35%) now sits close behind growth (38%) as a reason to expand internationally.

Trade policy is also influencing timing. In the survey, 48% said tariffs have accelerated their plans. When policy shifts can change landed costs and competitiveness quickly, partnerships can provide a faster, lower-regret way to establish presence and optionality than building from scratch.

Localisation adds another layer. Governments want investment, but many also want technology transfer, domestic jobs, local procurement and in-country processing. In materials especially, industrial policy can reshape economics, permitting and stakeholder expectations. In power and infrastructure, market access often depends on local relationships, regulatory understanding and the ability to navigate public and private stakeholders at pace.

Capital intensity remains a constraint throughout. Whether the business is developing generation assets, expanding processing capacity, building logistics capability or entering a downstream market, the upfront commitment can be significant. That matters even more when long-term economics are exposed to volatile input costs, shifting incentives and uncertain offtake. Boards are therefore placing greater value on structures that preserve flexibility, share risk and shorten the path to returns.

This is why partnership-led expansion has moved closer to the centre of strategy. It offers a way to build relevance in a market before making irreversible bets.

The strongest businesses are not turning to partnerships because they lack confidence. They are doing so because they understand where uncertainty now sits and which risks are worth owning.

In some cases, the goal is market access. A local partner can provide route-to-market capability, operating knowledge and credibility with regulators that would take years to build independently. In others, the value lies in capability. A company may have strength in project development or upstream production but need a partner with processing, distribution, technology or customer access in a new geography. In highly regulated markets, collaboration can also reduce execution risk by aligning incentives with parties that already understand the local framework.

That risk-navigation aspect matters because the obstacles to international expansion remain stubbornly real. HSBC’s research highlights economic conditions (35%) and regulation/trade policy (34%) among the most cited barriers. Partnerships won’t remove macro risk, but they can reduce single-point exposure and help businesses move faster with better local intelligence.

Joint ventures are particularly useful where risk and capital need to be shared across large, complex projects. They allow companies to participate in growth without carrying the full burden of development, construction or market formation alone. Strategic alliances can be lighter, but still powerful, especially when speed matters. They can help businesses test demand, secure supply, or establish a foothold while retaining room to scale, deepen or exit as conditions evolve.

Even franchising and licensing models, though less discussed in industrial boardrooms, have a clear role in parts of the value chain. Where operating standards, brand, technical know-how or service models can be replicated across markets, they can offer a lower-capital route to expansion with greater local responsiveness.

The point is not that one structure is superior. It is that leading companies are becoming more disciplined in matching structure to market conditions. They are asking sharper questions. What capabilities must we own? What can we share? Where is control essential, and where is influence enough? How do we enter early without overcommitting? How do we build optionality into the model from day one?

Those questions are now central to competitive advantage.

The sector is moving into a period where speed and caution must coexist. Companies cannot afford to wait for perfect clarity before entering growth markets. But they also cannot assume that scale alone will protect returns.

That is why partnerships will continue to gain ground. They offer a way to localise without fragmenting strategy, to access opportunity without taking all risk onto the balance sheet, and to build competitive position before market structures fully settle.

And expansion itself is becoming more multi-track. Among firms looking to expand internationally, the research found 84% plan to expand physical operations, while 70% intend to expand products or services digitally into new markets over the next two years. Partnerships can support both: on-the-ground presence through local operating capability, and quicker routes to market through shared platforms, distribution or service models.

For boards, the implication is clear. International growth should no longer be framed as a simple choice between build, buy or hold back. The more useful question is how to combine control, access and optionality in a way that matches the realities of each market. Increasingly, the answer will involve collaboration.

The companies that do this well will not treat partnerships as a compromise. They will treat them as a deliberate model for expansion in a more complex world. That is likely to be one of the defining advantages of the next decade.

International expansion in energy, materials and power is moving faster even as uncertainty rises. The research suggests this isn’t a pause moment: most firms still plan to expand overseas in the next two years, and many say tariffs are accelerating decisions. For businesses, the message is that entry strategy matters as much as market selection, and partnership-led approaches are increasingly the practical way to balance pace, resilience and capital discipline.

The full report explores what’s driving this renewed push for international growth, what’s holding it back, and how companies are adapting their operating models.