The ASEAN+3 region emerges as a beacon of resilience and growth in an era of global economic unpredictability. The ASEAN+3 Macroeconomic Research Office (AMRO) has recently announced its 2024 growth forecast, setting the stage for an impressive 4.5 percent expansion. This prediction, a part of the January quarterly update of the ASEAN+3 Regional Economic Outlook (AREO), signals a robust year ahead for the economies within this dynamic region.

The forecast marks a continuation of the region’s upward trajectory, following a commendable full-year growth of 4.4 percent in 2023, a slight increase from the previous 4.3 percent projection. This upsurge can be primarily attributed to China’s significant growth, estimated at 5.2 percent, a noteworthy jump from the last quarter’s 5.0 percent forecast. This progress is underpinned by stabilizing industrial and service activities in the Chinese economy, providing a ripple effect of economic vitality across the ASEAN+3 region.

AMRO Chief Economist Hoe Ee Khor shed light on the nuanced progress of the region. “The global tech cycle’s recovery is starting to positively influence our region’s export performance, particularly in the electronics sector. However, the revival in non-tech exports remains gradual, as indicated by the mixed manufacturing sentiment surveys,” Khor explained.

Furthermore, the ASEAN+3 region, excluding Lao PDR and Myanmar, anticipates moderate inflation rates of 2.6 percent this year, descending from 2023’s estimated 2.8 percent. This trend mirrors the global decrease in commodity prices, yet the region remains vigilant against persistent core inflation and potential spikes in global commodity prices.

Despite the optimistic outlook, Khor cautioned about several external risks. “Global commodity price fluctuations remain a significant threat to our growth trajectory. Additionally, we cannot discount the possibility of a US recession or the policy uncertainties and market volatility leading up to the 2024 US elections,” he warned.

AMRO’s analysis suggests a potential recession in the US and euro area could halve the region’s GDP growth. This impact could be further exacerbated if China’s economic recovery loses momentum.

As the world eyes the unfolding economic landscape, the ASEAN+3 region is a testament to resilient growth and adaptive strategies. The full AREO 2024 report, scheduled for publication in April, is eagerly awaited for more detailed insights into the economic future of this vibrant region.

With an unwavering focus on sustainable growth, the ASEAN+3 region navigates global challenges and sets a precedent for economic resilience and proactive adaptation.

Written by: My Thanh Pham

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