Asia's Economic Landscape

Asia is the largest continent on the planet, covering 53 million square kilometers, and it is the most populous region with 4.5 billion people. It is also the fastest-growing economic area according to the estimates of the International Monetary Fund (IMF) and a group of countries among the most influential in the United Nations General Assembly. The IMF's October 2023 outlook suggests that the economy of Emerging and Developing Asia will grow by 5.2 per cent in 2023 and 4.8 per cent in 2024, with an urbanization rate exceeding 50 per cent, and a projected increase in population to 5.3 billion by 2050, making it the second youngest region after Africa, with a median age of 31 years, along with South America.

Among the economically significant regions in the Far East are Northeast Asia, including China, Japan, and South Korea, and Southeast Asia, comprising the ten member countries of the Association of Southeast Asian Nations (ASEAN). These sub-regions include most of the population in the high and upper-middle-income brackets according to the World Bank classification, hosting nine of the world's ten busiest ports. Along with the Pacific region, including Australia and New Zealand, they form the world's largest free-trade area since 2022, thanks to the Regional Comprehensive Economic Partnership (RCEP) agreement.

In the Asian region, China stands out as the leading country in terms of Gross Domestic Product (GDP), aggregate trade, imports and exports, foreign direct investments, the number of economic agreements, and in monetary matters. As stated by President Xi Jinping, Beijing aspires to become a financial superpower, emphasizing the need for a strong yuan and defining its domestic system as distinct from Western models. China currently owns the banks with the highest capitalization, including Industrial and Commercial Bank of China (ICBC), China Construction Bank, Agricultural Bank of China, and Bank of China. It also hosts some of the largest stock exchanges (Shanghai, Hong Kong, Shenzhen) and is home to the Asian Infrastructure Investment Bank (AIIB), founded in 2014 as an alternative institution to the World Bank. According to a monthly monitoring of the yuan published by the Society for Worldwide Interbank Financial Telecommunication (SWIFT), the Chinese currency has surpassed the Japanese yen, becoming the fourth most widely used currency for global payments after the US dollar, euro, and British pound, confirming Beijing's leadership in the region's economy and finance.

In 2023, China's GDP increased by +4.5 per cent in the first quarter, +6.2 per cent in the second, +4.9 per cent in the July-September period, and 5.2 per cent in the fourth quarter. Critical data includes a decrease in exports (-4.6 per cent), imports (-5.5 per cent), and aggregate trade (-5 per cent), a decline in foreign direct investments (-8% per cent), and a contraction in the manufacturing sector with the Purchasing Managers' Index (PMI) below the 50 threshold. In 2023, fixed investments (spending on infrastructure, real estate, machinery, and equipment) increased by 3 per cent compared to the previous year, the urban unemployment rate for the year was 5 per cent, while the youth unemployment rate reached 14.9 per cent.

Regarding the growth estimates of China's GDP for 2024, the IMF predicts 4.6 per cent, the World Bank forecasts 4.4 per cent, and the Asian Development Bank anticipates 4.5 per cent.