2024 Outlook: Asia’s Dynamic Landscape in Markets, Geopolitics, and Elections – what to expect?

A few decades back, western observers and economists consistently discussed the considerable future potential of Asia’s rise, the past decade has made it evident for the rest of the world to reassess their perceptions, as the continent’s rise not withholding its market dynamics and geopolitical tensions materialized more rapidly than anticipated. One of the most striking occurrences being the remarkable surge in consumption and integration of emerging Asia into global networks of trade, capital, talent, and innovation.

As we enter the year 2024, analysts, armed with optimistic forecasts, closely monitor India’s Nifty 50, anticipating substantial market growth. The impressive surge in Japan during the previous year, with the Nikkei 225 rising by 28% and the Topix concluding 25% higher, infused the Japanese market with the resilience to navigate through another year of volatility. Vietnam also emerges as a promising prospect on the horizon, poised for a significant upswing in 2024, anticipating buoyant imports and exports, along with heightened manufacturing activity, Vietnam foresees a GDP growth ranging from 6% to 6.5% in 2024.

Yet, in the middle of these promising economic developments, geopolitical unrest and important national elections loom large will be reshaping the complex fabric of Asia’s future course.

Asian markets

With the International Monetary Fund (IMF) predicting a strong 4.2% growth in 2024—above the 2.9% worldwide growth average—the Asia Pacific area is well-positioned to prosper in the global economy. The Asia-Pacific markets are expected to be dominated by Vietnam, Japan, and India in the first half of 2024, according to CNBC analysts.

While businesses have shifted their strategies to embrace a “China plus one strategy,” exhibiting this optimistic outlook. Investors are additionally growing more interested in looking into additional possibilities in the area. Hong Kong’s Hang Seng Index struggled and finished as the worst performer in 2023, while Japan’s Nikkei 225 was the best-performing index throughout the year.

Notwithstanding the concerns surrounding China, analysts point out bright spots amid this pessimism, implying that chances still exist in the vibrant Asian markets. A Nikkei study shows that 75% of respondents anticipate China’s GDP growth will lag the levels observed in prior boom years, notwithstanding the general pessimism surrounding it.

In the midst of the world economy changing quickly and the US-China relationship reaching a turning point, market analyst Hebe Chen of IG International highlights the challenges encountered by investors around the world.

The heightened uncertainty and anxiety, unavoidably fuelled by the swiftly evolving international landscape and the critical point in the China-US relations, will not make it easy for global investors to find their solace.

Hebe Chen, Market Analyst IG International

Elections and Geopolitics

Amid intricate mix of global changes, numerous national elections, and the influence of Federal Reserve through monetary policies, Asia’s positioned to claim a prominent role at the global stage.

However, with conflicts raging in Europe and the Middle East, the international stage is marked by uncertainty, presenting a challenging backdrop for nations worldwide. The year unfolds against a backdrop of significant shifts in power, raising questions about the potential ramifications for the Asian continent.

Despite the anticipated tumult, the region is expected to emerge as a focal point of attention. The confluence of a bustling election calendar, the far-reaching impact of global monetary policies, and the geopolitical chessboard will captivate observers, unveiling Asia’s destiny in the face of unprecedented challenges and opportunities.

Authored by

Sarika Tiwari

Edited by

Queenie Nair