Manufacturers in Asia quietly reached the end of 2024 as growing uncertainty on trading amid the upcoming U.S. President Donald Trump and the slow recovery of China’s shaken economy dulled any expectation for the New Year.
In December, numerous manufacturing purchasing manager’s indexes from across the region showed factory activity in China and South Korea slowing down, while in Taiwan and South Asia picking up the pace.
Trump has promised to levy a massive tariff on three of its major trading partners: China, Mexico, and Canada, which could also impact other large exporting nations and global trading activity.
The Caixin/S&P Global manufacturing PMI for China dipped to 50.5 in December from 51.5 in November and failed to meet analyst’s expectations. These numbers are an indication of a strictly gentle growth.
Assistant Economist Gabriel Ng of Capital Economics, said that China’s economic stimulus measure in late 2024 has been boosting growth in the fourth quarter, and it is likely to carry over to early 2025 as well, though the boost would only last a few quarters. China’s economy would likely remain weighed down by its structural imbalance and Trump’s tariff.
South Korea’s PMI also showed a decline in activity in December as well, and the already declining output is starting to intensify, a night and day to the export growth figure released on Wednesday that shattered any forecast.
Governor of South Korea’s central bank said that the easing of monetary policy would need to be more flexible in 2025 because of the country’s growing political and economic uncertainty.
Japan’s PMI also showed signs of slowing down, though the pace slowed down during December.
India’s activity grew at its slowest pace for 2024, while South East Asia remained outperforming its neighbor, but Malaysia and Vietnam did report a decline in activity.
Meanwhile, Taiwan’s activity has been growing at the fastest rate in five months, reporting strong sales in Asia, Europe, and North America.
