I began my project with world-building. Afterward, I decided on the overarching plot, and now I'm trying to populate it with characters, starting with my protagonist. I've figured out his core driving force, but I have trouble coming up with a growth arc for him.
Plot & Premise
My world is a classic fantasy mixed with cosmic horror. The evil wizard messes with forces beyond his comprehension, leading to his undoing before he can rise to power, so the protagonist gets to grow up in a peaceful world. (Think Harry Potter if Tom Riddle got himself killed before he could become Lord Voldemort.)
But because the two are connected by fate, whatever happened to the wizard has left a stain on the hero's soul, too. I haven't worked out the details—it may be that something's wrong with his magic, or he wades through life discontent, feeling like he's missing some fundamental piece of himself—but it's going to be the force that drives him down the same road as the wizard, in search for answers.
The turning point will be him accidentally unleashing what has become of the wizard upon the world. (Rather than a person, the wizard will have taken an intangible form and will spread like a virus. It can only be tracked through its effects on people, like in Bird Box.) He has to fix his mistake and defeat the horror before it destroys everything.
Problem
I'm struggling to come up with a character arc for the protagonist. The standard method is to give him some kind of flaw which he eventually overcomes in the climax. Alternatively, as described here, a past experience will have given rise to a harmful belief, which the character plasters over with another belief, and he must realize he's lying to himself and muster the courage to move past it; or something like that.
I don't know how to fit my character into that framework. His problems stem from an external source. No amount of internal growth will fix that. Do I need to give him another problem, one which, upon confronting and overcoming, will allow him to fix the external problem?
I should note that the cosmic horror is intended as a background element to enrich the world, like Tolkien did with his distant mountains. It is the theme of the story—fear of the unknown—and I built the world and the magic system around it, but the main conflict is in ethnic tensions (which spring from the same fear). My other great woe is trying to weave the two conflicts, the hero's exploration of the eldritch corners of the magical world and his position in the middle of said tensions, into a cohesive plot.