巻 頭 言【 P r e f a c e 】

What to watch in 2024 :Global trade andtop trade themes in AsiaPacific

Tom Rafferty

Head of Global Forecasting and Economics
Economist Intelligence Unit

In 2024, global demand is expected to stage amodest recovery. This will largely reflect a
hangover from pandemic-era disruptions,particularly amid inventory destocking following
the frontloading of orders amid supply-chain
disruptions in 2021-22. This will support newexport and manufacturing activities, sustained
partially by a mild rebound in global electronics
demand. The outlook for services trade is also
positive, as global tourism is continuing to recoverand the nearshoring of value chains is driving
outsourcing investment into sectors like financial
services, consulting and telecommunications.

barriers, for example—erected partially in response
to growing Western scrutiny over China’s subsidydriven industrial model, particularly as that countryleans more heavily on external demand to deliver
growth—will preserve trade policy risks. These willbe the most prominent in sectors like emerging
technology and renewable energy. Climate risks,such as the effect of drought on water levels in thePanama Canal, will complicate global shipping
operations and make them more costly. This will
happen at a time when global freight rates are
already rising as a result of geopolitical developmentsin the Middle East.

These benign assumptions remain vulnerable to awide range of factors. The depressive effects ofelevated global interest rates, signs of coolingWestern consumer demand and prolonged importweakness in China could easily derail this outlook,given our view that many of the growth andgeopolitical fissures present in 2023 will slip into2024. We expect these downside risks to be mostpronounced in the first half of 2024. By contrast,easier global credit conditions from mid-year should
help to revive consumer and investment activity,
putting a stronger floor under global trade growth.

Top trade themes in Asia-Pacific

Nevertheless, other structural impediments to tradeare rising. An expected proliferation in global trade

1. Food security concerns will intensify, particularly
over rice. The negative effects of El Niño weather
patterns will cause the agricultural protectionismevident in 2023 to persist into 2024. India had
already imposed a ban on rice exports in July
2023. The inability of other major producers likeThailand and Vietnam to offset the resulting
shortfall consequently caused regional rice prices
to surge. The likelihood of India keeping its
export ban in place until after its elections in mid2024 suggests that rice prices will remain
elevated. Food security concerns will preserve
the risk of copycat export restrictions across rice2024.3

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exporting markets in Asia and South America.
2. Export restrictions on critical minerals and rareearths will come into greater focus. These policies
have already become a geopolitical flashpoint
between China and the West, and efforts bySouth-east Asian nations to take advantage of
their own natural resource endowments, todevelop domestic refining and processing
capacities, will increase trade protectionism.
Indonesia’s prohibitions on nickel ore exports
and its planned restrictions on copper ore—alongside Malaysia’s consideration of a similar
ban on rare earth exports—may encourage othernations with reserves of critical minerals or rareearths to adopt similar measures. We advise
observers to keep a close eye on Vietnam.
3. Worsening Chinese industrial overcapacity will
exacerbate international trade frictions. The
resilience of Chinese goods export volumes hascontrasted with weakness in export values,
illustrating the depressive effects of producer
price deflation. These factors partly reflect theprice competitiveness of Chinese firms. Westerngovernments are nevertheless concerned that
aggressive Chinese subsidies have unfairly
facilitated this, particularly as the surge in
Chinese internal combustion engine and electricvehicle (EV) exports is likely to continue in thecontext of domestic automotive price wars. Tradeconcerns around Chinese subsidies may spillover into other sectors in 2024, but this could also
create export opportunities for other Asian
exporters like Indonesia, Vietnam and SouthKorea.

22024.3<Biography>
Tom Ra f f ert y is t he head of g loba l f oreca st ing a nd
economics at EIU. He draws on more than a decade ofexperience as an analyst, much of it spent working in
China. He is a published expert on China’s political
economy and has conducted in-depth research on issues
such as supply chains and geopolitical risk across Asia.
Prior to EIU, Tom held research and policy roles inorganisations including the UK Parliament and Oxford
Analytica. He holds bachelor’s and master’s degrees
from the University of Oxford.
（企業概要）
エコノミスト インテリジェンス ユニット（EIU）は1946年にイギリスで創業し、世界および国家レベルでのマクロ経済や政策、リスクなどについての動向を調査し、ビジネスにおける意思決定のための重要な洞察を提供しています。
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