GLOOMY AND MORE UNCERTAIN (JULY 2022 IMF Projection)

[Bilal9]

The next thing to be concerned about is food security. Countries that grow plenty will fair better.

Spoken well. In Bangladesh this is a huge issue, lots of mouths to feed.

However Bangladesh is also the world's leading food producer in many sectors, despite having an area the size of Wisconsin.

"It is the first in hilsa production in the world, the third in rice production, the third in indoor open water fish production, the fifth in closed water fish production, the fourth in Black Bengal goat production, the third in vegetable production and the sixth in potato production.

In the last 12 years, Bangladesh has made unprecedented progress in the livestock sector. Bangladesh is now self-sufficient in meat and egg production and will become self-sufficient in milk production in 4-5 years."

Bangladesh among top 10 global producers in 13 sectors: livestock minister

Bangladesh has achieved the top 10 places in the world in 13 sectors including fish production, Fisheries and Livestock Minister SM Rezaul Karim said today.

www.thedailystar.net

 

[Indos]

PRESS RELEASE
OCTOBER 26, 2022

Currency Depreciations Risk Intensifying Food, Energy Crisis in Developing Economies​

Elevated commodity prices could prolong inflationary pressures

WASHINGTON, October 26, 2022—The shrinking value of the currencies of most developing economies is driving up food and fuel prices in ways that could deepen the food and energy crises that many of them already face, according to the World Bank’s latest Commodity Markets Outlook report.

In U.S. dollar terms, the prices of most commodities have declined from their recent peaks amid concerns of an impending global recession, the report documents. From the Russian invasion of Ukraine in February 2022 through the end of last month, the price of Brent crude oil in U.S. dollars fell nearly 6 percent. Yet, because of currency depreciations, almost 60 percent of oil-importing emerging-market and developing economies saw an increase in domestic-currency oil prices during this period. Nearly 90 percent of these economies also saw a larger increase in wheat prices in local-currency terms compared to the rise in U.S. dollars.

Elevated prices of energy commodities that serve as inputs to agricultural production have been driving up food prices. During the first three quarters of 2022, food-price inflation in South Asia averaged more than 20 percent. Food price inflation in other regions, including Latin America and the Caribbean, the Middle East and North Africa, Sub-Saharan Africa, and Eastern Europe and Central Asia, averaged between 12 and 15 percent. East Asia and the Pacific has been the only region with low food-price inflation, partly because of broadly stable prices of rice, the region’s key staple.

“Although many commodity prices have retreated from their peaks, they are still high compared to their average level over the past five years,” said Pablo Saavedra, the World Bank’s Vice President for Equitable Growth, Finance, and Institutions. “A further spike in world food prices could prolong the challenges of food insecurity across developing countries. An array of policies is needed to foster supply, facilitate distribution, and support real incomes.”

Since the outbreak of the war in Ukraine, energy prices have been quite volatile but are now expected to decline. After surging by about 60 percent in 2022, energy prices are projected to decline 11 percent in 2023. Despite this moderation, energy prices next year will still be 75 percent above their average over the past five years.

The price of Brent crude oil is expected to average $92 a barrel in 2023—well above the five-year average of $60 a barrel. Both natural gas and coal prices are projected to ease in 2023 from record highs in 2022. However, by 2024, Australian coal and U.S. natural-gas prices are still expected to be double their average over the past five years, while European natural gas prices could be nearly four times higher. Coal production is projected to significantly increase as several major exporters boost output, putting climate-change goals at risk.

“The combination of elevated commodity prices and persistent currency depreciations translates into higher inflation in many countries,” said Ayhan Kose, Director of the World Bank’s Prospects Group and EFI Chief Economist, which produces the Outlook report. “Policymakers in emerging market and developing economies have limited room to manage the most pronounced global inflation cycle in decades. They need to carefully calibrate monetary and fiscal policies, clearly communicate their plans, and get ready for a period of even higher volatility in global financial and commodity markets.”

Agricultural prices are expected to decline 5 percent next year. Wheat prices in the third quarter of 2022 fell nearly 20 percent but remain 24 percent higher than a year ago. The decline in agricultural prices in 2023 reflects a better-than-projected global wheat crop, stable supplies in the rice market, and the resumption of grain exports from Ukraine. Metal prices are projected to decline 15 percent in 2023, largely because of weaker global growth and concerns about a slowdown in China.

The outlook for commodity prices is subject to many risks. Energy markets face significant supply concerns as worries about the availability of energy during the upcoming winter will intensify in Europe. Higher-than-expected energy prices could feed through to non-energy prices, especially food, prolonging challenges associated with food insecurity. A sharper slowdown in global growth also presents a key risk, especially for crude oil and metals prices.

“The forecast of a decline in agricultural prices is subject to an array of risks,” said John Baffes, Senior Economist in the World Bank’s Prospects Group. “First, export disruptions by Ukraine or Russia could again interrupt global grain supplies. Second, additional increases in energy prices could exert upward pressure on grain and edible oil prices. Third, adverse weather patterns can reduce yields; 2023 is likely to be the third La Niña year in a row, potentially reducing yields of key crops in South America and Southern Africa.”

Special Focus: Decline in Copper and Aluminum Prices and the Impact on Developing Economies​

Concerns about a possible global recession next year have already contributed to a sharp decline in copper and aluminum prices. A Special Focus section of the report examines the drivers of aluminum and copper prices and explores implications for emerging market and developing economies that export these commodities. Prices will likely remain volatile as the energy transition unfolds and demand shifts from fossil fuels to renewables, which will benefit some metal producers. Metal exporters can make the most of the resulting opportunities for growth over the medium term while limiting the impact of price volatility by ensuring they have well-designed fiscal and monetary policy frameworks, the report highlights.

Commodity Markets Outlook: Currency Depreciations Risk Intensifying Food, Energy Crisis in Developing Economies

A slowdown in global growth and concerns of an impending global recession has eased most commodity prices from their peaks. However, the shrinking value of many currencies against the U.S. dollar since the beginning of 2022 has pushed food and energy prices in domestic-currency terms even higher.

www.worldbank.org

 

[Indos]

A new kind of global recession: Why this time is different | Business Beyond​

 

[Indos]

Cooling Demand Squeezes Factory Activity in Europe and Asia​

• PMIs point to contraction in wide parts of both regions
• S&P cites ‘challenging global economic environment’ as factor

By
Claire Jiao and
Alexander Weber
December 1, 2022 at 16:05 GMT+7Updated onDecember 1, 2022 at 17:04 GMT+7

Factories in Europe and Asia struggled in November due to weakening global demand, with the pressure unlikely to let up in the months ahead.

Business surveys by S&P Global on Thursday pointed to shrinking activity and a dire outlook in wide parts of both regions. Asian manufacturers are bracing for a further pullback in spending from US and European customers, where the fastest inflation in decades is weighing on companies and households.

The pace of the euro area’s downturn slowed, however, a signal that a widely expected recession may turn out to be less severe than initially feared. Softer demand also helped ease cost pressures linked to logistical snarls.

“Future output expectations have picked up slightly on improved supply-chain and energy-market signals, the latter buoyed by warmer than usual autumn weather,” S&P Global economist Chris Williamson said in a statement. “But confidence remains amongst the lowest seen over the past decade.”

The global economy is cooling as a result of soaring prices and uncertainty stoked by Russia’s war in Ukraine. Central banks, meanwhile, are continuing to move aggressively to stamp out inflation, weighing on purchasing power.

https://sponsored.bloomberg.com/art...irst-round-the-clock-renewable-energy-project
Manufacturing had just started to recover from pandemic-related lockdowns and supply-chain disruptions, making the global slowdown a rising concern.

While the euro-zone PMI rose to 47.1 from 46.4 in the previous month, it remained below 50 -- the line separating expansion from contraction. Germany, the Netherlands and Spain were the report’s worst performers.

The region’s jobs market is holding up, however. The unemployment rate dropped to a record-low 6.5% in October, separate data Thursday showed.

Vietnam recorded the sharpest deterioration in Asia. Its PMI fell to 47.4 in November from 50.6 in October -- the first time in over a year the gauge dipped below 50.

In Japan, the gauge dropped below that threshold for the first time in almost two years. Electronic hubs Taiwan and South Korea were also sluggish as producers curbed purchasing and inventory amid weaker overseas demand.

The output downturn in Taiwan -- whose PMI inched up slightly from October but was still well in contraction at 41.6 -- “underscores the weakest performance of the sector since the global financial crisis in 2009,” said Annabel Fiddes, economics associate director at S&P Global Market Intelligence, in a statement accompanying the data.

She said firms are “not anticipating things to improve anytime soon,” based on an “incredibly downbeat” 12-month outlook. “An increasingly challenging global economic environment” of inflationary pressure and tightening financial conditions “is expected to constrain performance in the months ahead.”

In China, a gauge of manufacturing activity jointly published by Caixin and S&P Global on Thursday came in at 49.4 in November, remaining below the 50 mark for a fourth straight month. That followed dismal PMI readings on Wednesday, when official indexes measuring manufacturing and non-manufacturing fell to the lowest levels since the Shanghai lockdown in April.

The impact of Covid flareups and related restrictions was evident, according to the data. Companies reduced purchasing activity and cut staff numbers further as factory output fell at a faster rate than in the previous month amid movement restrictions, S&P Global said in a statement.

There were a couple of positive readings in Southeast Asia, where manufacturing PMIs for Thailand and Indonesia continued to expand -- albeit at slower paces in November than the month before. The Philippines was the standout, with a region’s best PMI reading of 52.7.

Cooling Demand Squeezes Factory Activity in Europe and Asia

Factories in Europe and Asia struggled in November due to weakening global demand, with the pressure unlikely to let up in the months ahead.

www.bloomberg.com

@Bilal9 Look on Indian PMI in Q3, their PMI is always above 50 since August 2021 (meaning in expansion mode), we know the PMI is based on survey. But we see the reality is different with its Q3 2022 real data. Just check this real calculation by Indian statistics body

PS : I use international standard (Q1 = Jan-March)

India GDP growth halves in September quarter as COVID distortions pass

India posted annual economic growth of 6.3% in its July-September quarter, less than half the 13.5% growth in the previous three months as distortions caused by COVID-19 lockdowns faded in Asia's third-largest economy.

www.reuters.com

 

[Indos]

Russia-Ukraine war will likely continue and possibly turn into lower intensive conflict for quite long period of time. Energy supply will still likely be disrupted for much longer time as Western Europe has already been determined to not depend on Russian energy anymore

Vladimir Putin demands annexations recognised before talks with US president Joe Biden - BBC News​

 

[Indos]

South Korea’s trade deficit reflects global economic challenges​

16 December 2022

South Korea posted a trade deficit of US$3.8 billion in September 2022 — higher than experts predicted in a Reuters poll at the end of September but slightly lower than South Korea’s Customs Services forecast. The latest official data of South Korea shows that the trade deficit reached US$7 billion in November and the cumulative trade deficit has reached US$42.6 billion since the first deficit in April 2022.

This is the eighth consecutive month of trade deficits. Neither the number of consecutive months of deficits nor the size of the trade deficit have been seen at this scale since 1997.
Two major conclusions can be drawn from looking at South Korean imports and exports. First, the government has implemented a trade strategy towards the Southeast Asian market.

Second, trade relations between China and South Korea are undergoing major changes.
One reason for the deficits is the increasing value of energy imports. In the first eight months of 2022, South Korea imported US$145 billion of energy, accounting for 29.4 per cent of its total import quota. Energy spending in the first eight months of 2022 has surpassed 2021’s total and is nearly US$64 billion higher than the same period.

A more important factor contributing to South Korea’s massive trade deficit this year is the decline in Korean exports. This was mainly caused by a sharp drop in semiconductor-related exports. In January–August 2022, semiconductor exports fell by 49.4 per cent from 2021 to US$36.2 billion. Semiconductor exports accounted for 7.7 per cent of South Korea’s total exports in 2022, down from 17.7 per cent in 2021. This is the biggest drop among all South Korean export categories.

China is South Korea’s main export destination for semiconductor-related products. In recent years, China has imported over 40 per cent of South Korea’s semiconductors. In the first eight months of 2022, South Korea exported US$12.2 billion of semiconductors to China, a year-on-year decrease of 58.9 per cent from 2021. The Chinese market share has dropped from 40 to 33.7 per cent. This instability has not been seen since China and South Korea formally established diplomatic ties in 1992. At the same time, South Korean semiconductor-related exports to Vietnam, Taiwan and Singapore have increased significantly.

In 2021, more than half of South Korea’s trade was conducted with China, the United States, Japan, Vietnam and Taiwan — accounting for 23.9 per cent, 13.4 per cent, 6.7 per cent, 6.4 per cent and 3.8 per cent of South Korea’s total trade respectively. In the first nine months of 2022, China’s share decreased the most, close to 1.9 per cent. The decline of Chinese–South Korean trade is one of the most important reasons for its trade deficit.

But South Korea’s trade deficit cannot be solely attributed to China. Japan, Australia and Singapore are also major contributors to South Korea’s trade deficit. In the first nine months of this year, South Korea’s trade gap with these economies reached US$42.5 billion. Surprisingly, South Korea’s export growth to these countries is far greater than its import growth.

China’s technological progress is an important reason for this paradigm shift. China’s trade deficit with South Korea has been on the decline in recent years, from US$95.9 billion in 2018 to US$60.6 billion in 2021. Based on this data, China may have already reached the peak of its trade deficit with South Korea. Accordingly, South Korea needs to adjust to a more balanced trade relationship with China.

Changes in China–South Korea economic and trade relations reflect broader changes in the global political economy. China–US competition has forced South Korea to diversify its trade relations. In both China and the United States, global challenges such as pandemic prevention and control have compromised economic growth.

The depreciation of South Korea’s currency against the US dollar is another important factor in South Korea’s trade deficit. The won has depreciated by more than 20 per cent since early January 2022. The last time that this occurred was during the 2008 global financial crisis.
2022 marked the third peak in South Korea’s trade deficit. Out of 66 years of trade balance data, the Korea International Trade Association has registered 39 years of deficit. The previous two peaks of South Korean trade deficit occurred during major economic and financial crises. South Korea’s trade deficit peaked at US$20.6 billion in 1996. In 2008, South Korea had an annual trade deficit of US$13.3 billion.

Given such a history, South Korea’s current trade deficit reflects a bleak global economic trend. South Korea is famous for its export-oriented economic model. It is the seventh largest commodity exporter in the world, and its economic growth is highly dependent on trade. South Korea’s unprecedented trade deficit in 2022 indicates a larger international economic and financial crisis looming.

Zhong Feiteng is a senior research fellow at the National Institute of International Strategy, Chinese Academy of Social Sciences.

South Korea’s trade deficit reflects global economic challenges | East Asia Forum

South Korea's unprecedented trade deficit in 2022 indicates a larger international economic and financial crisis looming.

www.eastasiaforum.org

 

[Indos]

China's economy statistics show weaker than expected results | Inside Story​

 

[Indos]

Singapore Non Oil Export (Singapore like India has big refinery industry)

November 2022

Singapore non-oil exports tumble 14.6% in November; economists warn of darkening outlook

Economists warned that demand will continue to soften in the months ahead and this will weigh on Singapore’s economy. Read more at straitstimes.com.

www.straitstimes.com

 

[Mista]

Singapore Non Oil Export (Singapore like India has big refinery industry)

November 2022

View attachment 906382

Singapore non-oil exports tumble 14.6% in November; economists warn of darkening outlook

Economists warned that demand will continue to soften in the months ahead and this will weigh on Singapore’s economy. Read more at straitstimes.com.

www.straitstimes.com

Wanted to post this here but you beat me to it lol.

 

[Indos]

November 22, 2022
11:05 PM GMT+7

Last Updated 25 days ago

Europe to be hit hardest in global slowdown -OECD​

By Leigh Thomas

• Global growth seen falling from 3.1% in 2022 to 2.2% in 2023
• National outlooks vary widely, with UK lagging other economies
• Central banks urged to keep hiking interest rates

PARIS, Nov 22 (Reuters) - The global economy should avoid a recession next year but the worst energy crisis since the 1970s will trigger a sharp slowdown, with Europe hit hardest, the OECD said, adding that fighting inflation should be policymakers' top priority.

Reporting by Leigh Thomas; Editing by Catherine Evans

Europe to be hit hardest in global slowdown -OECD

The global economy should avoid a recession next year but the worst energy crisis since the 1970s will trigger a sharp slowdown, with Europe hit hardest, the OECD said, adding that fighting inflation should be policymakers' top priority.

www.reuters.com

 

[Cheepek]

Look on Indian PMI in Q3, their PMI is always above 50 since August 2021 (meaning in expansion mode), we know the PMI is based on survey. But we see the reality is different with its Q3 2022 real data. Just check this real calculation by Indian statistics body

Learn:
1) PMI is not calculated by the government.
2) PMI is not equal to GVA.
3) PMI constitutes: New orders (30%), Output (25%), Employment (20%), Supplier delivery time (15%), Stock of purchases (10%)
4) Manufacturing output constitutes only 25% of PMI.
5) It's not news PMI can diverge from manufacturing GVA.

 

[Indos]

WORLD

Thailand’s exports continue to drop in November 2022​

Thailand’s Ministry of Commerce on December 27 announced that the country’s exports in November dropped for a second straight month and worse than expected due to a global slowdown and China’s lockdown measures.
VNA Wednesday, December 28, 2022 10:54
https://link.gov.vn/VWvXHZcw

Exports, considered a key driver of Thailand’s growth, in November this year saw a year-on-year decrease of 6%, higher than the forecast by Reuter’s poll – just 5.2%. (Photo: BangkokPost)

Bangkok (VNA) – Thailand’s Ministry of Commerce on December 27 announced that the country’s exports in November dropped for a second straight month and worse than expected due to a global slowdown and China’s lockdown measures.

Exports, considered a key driver of the country’s growth, in November this year saw a year-on-year decrease of 6%, higher than the forecast by Reuter’s poll – just 5.2%.

In October 2022, Thailand’s exports declined by 4.4%.

According to the ministry, the export of agricultural and industrial-agricultural products in November 2022 fell 2% year-on-year, while that of industrial products fell 5.1%.

Among the country’s main markets in November, shipments to the US increased 1.2% year-on-year while those to Southeast Asia fell 9.5%. Exports to China fell 9.9%.

In the first 11 months of 2022, exports increased by 7.6% year-on-year, compared with the target of 4% set by the ministry for the year 2022.

In November, the country’s imports rose 5.6% year-on-year while the forecast decline was just 0.8%. Many imports will be used to produce exports.

Thailand recorded a trade deficit of 1.34 billion USD last month, higher than the forecast of only 200 million USD.

Earlier the same day, Thailand's Ministry of Industry’s data showed factory output in November fell 5.6% year-on-year, the biggest drop in more than two years due to slowing global demand. The ministry expects the output to fall further in December. Industrial products account for 80% of Thailand's total exports

According to Thai Government spokesman Traisuree Traisoranakul, the cabinet on the same day approved the Bank of Thailand's (BoT) target to keep inflation in 2023 between 1%-3%, unchanged from this year./.

Thailand’s exports continue to drop in November 2022 | World | Vietnam+ (VietnamPlus)

Thailand’s Ministry of Commerce on December 27 announced that the country’s exports in November dropped for a second straight month and worse than expected due to a global slowdown and China’s lockdown measures.

en.vietnamplus.vn

 

[Indos]

Exports continue to slump​

PUBLISHED : 28 DEC 2022 AT 06:24
NEWSPAPER SECTION: BUSINESS WRITER: PHUSADEE ARUNMAS


Exports are expected to continue dropping in December because of the global economic slowdown, but the Commerce Ministry remains confident that full-year export growth should be around 7%.

Commerce Minister Jurin Laksanawisit said on Tuesday the anticipated drop in December would also stem from a relatively high base in December last year.

Customs-cleared exports tallied US$24.9 billion in December 2021, a rise of 24.2% from the same month a year earlier, with imports increasing by 33.4% to $25.3 billion, resulting in a trade deficit of $354 million.

For the whole year of 2021, exports expanded by 17.1% to $271 billion, while imports rose by 29.8% to $268 billion, resulting in a trade surplus of $3.57 billion.

"With respect to the export outlook, the ministry assesses that the slowdown of the global economy and consumption will inevitably affect Thai exports. The appreciation of the baht coupled with geopolitical tensions might also be hindrances to exports during the remaining period of the year," he said.

"However, the efficient management of central banks in many countries has resulted in a slowdown in inflation and commodity prices. This may be a supporting factor that pushes up the purchasing power of trading partner economies. Moreover, government efforts to promote more exports through the China-Laos Railway along with China's reopening will be important factors driving trade growth since the beginning of 2023," he said.

The Commerce Ministry reported on Tuesday that exports dropped for a second straight month in November, blaming the global economic slowdown and China's lockdown measures.

The customs-cleared value of exports contracted by 6% year-on-year in November to $22.3 billion, after a 4.4% year-on-year drop in October.

Imports; however, increased by 5.6% to $23.6 billion, resulting in a trade deficit of $1.34 billion.

Exports of agricultural and agro-industrial products dropped by 2% in November from a year earlier to $3.73 billion, while shipments of industrial products declined 5.1% to $17.8 billion.

For the first 11 months of 2022, exports still expanded by 7.6% to $265 billion while imports rose by 16.3% to $280 billion, resulting in a trade deficit of $15 billion.

Mr Jurin said exports had been affected by the slowdown in the global economy, as higher prices and interest rates weigh on consumer purchasing power. Moreover, the zero-Covid measures in China affected the manufacturing sector, as reflected by the global Purchasing Manager's index (PMI) which was below 50 for three consecutive months.

The contraction of exports in November was lower than that of other Asian countries such as South Korea which saw a drop of 14% in the same month, with Taiwan down by 13.1%, China down by 9.2%, Vietnam down by 8.9% and Singapore down by 6.3%.

Nonetheless, there were positive factors, namely the continued decline in freight rates of US and European routes and the Ministry of Commerce's export stimulus strategies during the end of the year.

Exports continue to slump

Exports are expected to continue dropping in December because of the global economic slowdown, but the Commerce Ministry remains confident that full-year export growth should be around 7%.

www.bangkokpost.com

 

[Indos]

BUSINESSASIA

What's in store for emerging Asian economies in 2023?​

Srinivas Mazumdaru

12/27/2022December 27, 2022

Many economies in the region could be in for a bumpy ride next year, but some may also be set to benefit as companies diversify investments from the Chinese market.

South and Southeast Asian economies have had a challenging 2022, a year when the global economy was supposed to have recovered from the ill effects of the COVID-19 pandemic.
Instead, the Russian invasion of Ukraine, coupled with continued supply chain snags, recurring COVID lockdowns in China and soaring inflation, among other problems, have dampened growth prospects and caused economic pain to businesses and households.

The aggressive hiking of interest rates by the US Federal Reserve to control surging inflation has also led to a depreciation of a number of Asian currencies vis-a-vis the US dollar.
This has worsened some nations' debt troubles, eroded their purchasing power and prompted their central banks to raise rates accordingly to prop up their currencies.

Trade-oriented ASEAN economies face headwinds​

The rising costs for imports of food and fuel, among other goods, have depleted the foreign exchange reserves of some countries and triggered economic crises.

In South Asia, Sri Lanka and Pakistan have already received assistance from the International Monetary Fund after falling into debt distress and facing balance-of-payments difficulties.
Experts predict a challenging economic environment in 2023 amid weakening growth prospects all round for the US, eurozone and China, and tightening financial conditions.

China's COVID shift brings wave of illness​

The World Bank, IMF and the Asian Development Bank have all downgraded growth forecasts for developing Asia.

Trade-oriented economies like Singapore, Thailand, Vietnam and Malaysia are set to be especially affected by the slower global expansion, according to predictions.

Alicia Garcia-Herrero, chief economist for the Asia Pacific region at the investment bank Natixis, said growth in the region will be dragged down by weaker external demand and tighter monetary conditions.

"As external demand softens, exports are starting to sag, and we expect further weakness in the coming year," she noted, pointing out that trade-driven economies such as Malaysia and Vietnam have already contracted in November.

Rajiv Biswas, Asia Pacific Chief Economist at S&P Global Market Intelligence, shares a similar view. He said manufacturing exports from the Association of Southeast Asian Nations are facing increasing headwinds in 2023 amid recessionary conditions in the US and EU and weak domestic demand in China.

"ASEAN economies such as Malaysia, Singapore and Thailand are expected to show moderate economic growth in 2023, helped by continued expansion in domestic demand, albeit moderating," he told DW.

Will lifting COVID restrictions boost China?​

China, the largest economy in the region, is also expected to record slow growth in 2023, with the ADB recently cutting its projection for the country to 4.3% from 4.5%.

The Asian giant's economy has been hit hard by stringent coronavirus restrictions as well as a crisis in its massive property sector, with developers defaulting on loans and struggling to raise cash after Beijing imposed widespread lending curbs in 2020.

Beijing has attempted to boost growth by slashing key interest rates and pumping cash into the banking system.

Additionally, China this month abruptly abandoned its zero-COVID policy, after years of on and off lockdowns, mass testing, long quarantines and restrictions on people's movement.

While some restrictions remain in place, there is some hope that as China lifts the strict containment measures, domestic demand will revive in the world's second-largest economy.

This should also help some tourism-reliant Southeast Asian countries, like Thailand.

"ASEAN tourist arrivals are still shy of pre-COVID due to the lack of Chinese tourists," Garcia-Herrero said. "While we do not expect Chinese tourists to return to ASEAN as much as pre-COVID, one would expect that there will be a lift should China open up."

Biswas pointed out that the reopening of international borders in many Asia-Pacific countries during 2022 has already allowed a gradual restart of international tourism. "But momentum is expected to build significantly during 2023 in economies with large international tourism sectors, such as Thailand, Malaysia, Singapore and the Philippines," he predicted.

Will India's economy buck the trend?​

India, the region's second-largest economy, is also facing difficulties amid rising interest rates and a global trade slowdown. Meanwhile, elevated crude oil and gas prices have contributed to a deteriorating trade balance.

Consumer inflation, meanwhile, has consistently overshot the central bank's 2-6% target range, forcing the Reserve Bank of India to hike interest rates multiple times this year, pushing borrowing costs up to pre-pandemic levels.

"Continued economic expansion at a pace of 5.3% year-on-year is forecast for the 2023-24 financial year, with tighter monetary policy settings and weaker external demand acting as drags on economic growth," said Biswas.

Garcia-Herrero said India faces a few challenges in the coming year, pointing to tighter liquidity conditions, weakening exports and decelerating growth momentum.

"We expect India's GDP growth to slow to 6.3% year-on-year in 2023 from 6.9% in 2022," she said.

India struggles to produce enough formal jobs for its youth​

Companies diversify from China​

Experts have said companies will continue to diversify their investments away from China in 2023 to avoid the supply chain disruptions witnessed this year and amid growing geopolitical tensions between Beijing and the West. Some ASEAN nations are likely to benefit from this trend.

"Total FDI inflows data, which includes not just cross-border M&A flow but also greenfield investment, shows a surge of foreign direct investment into India, Singapore, Malaysia, Indonesia and Vietnam in 2022," said Garcia-Herrero.

"We expect this trend to continue even as China gradually lifts zero-COVID restrictions, providing a boost of not just capital inflow but also headcount demand to the ASEAN and India region."

Edited by: Kate Martyr

What's in store for emerging Asian economies in 2023? – DW – 12/27/2022

Many economies in the region could be in for a bumpy ride next year, but some may also be set to benefit as companies diversify investments from the Chinese market.

www.dw.com

 

[Indos]

Age of Easy Money (full documentary) | FRONTLINE​