APAC’s export engine is fading in 2023

Weaker Economic Growth

Economic growth in the Asia Pacific (APAC) region would likely lose steam this year amid a challenging global backdrop.

According to Moody’s Analytics, the economic growth across the region would be slower in 2023 than in 2022. And that is due to factors like inflation, the rapid pace of rate hikes, and the slowing global economy. In general, except for New Zealand, we anticipate the Asia Pacific region to avoid a recession.

The economic growth potential of nations like Australia and New Zealand will be affected by rising interest rates.

Slowing global trade growth

The APAC economies are slowing down due to expectations for slowing global trade growth this year.

Over the first half of this year, the outlook for exports is not great, and this region has no escape from international trade patterns. This is the main reason for the Asia Pacific region’s negative outlook almost across the board for 2023 compared to 2022, according to Moody’s Analytics.

Compared to a year ago, a few countries have reached the point where their exports are no longer rising. That is evident in the Philippines, Taiwan, Korea, and Singapore, where some electronic goods produced in those countries are no longer in high demand.

Even though Malaysia and Indonesia’s export figures currently look strong, they are slowing down over the past few months as a result of the decline in commodity prices.