China’s Recovery Effect is Uneven. Manufacturing activity in Asia weakened in December 2023 due to an uneven recovery in China that hampered a broad increase in demand. various purchasing managers’ indices (PMI) released by S&P Global show factory activity continuing to decline in most Asian countries at the end of 2023. General confidence has also declined.
Based on PMI data, technology-intensive Asian countries also still need to struggle with manufacturing activity in South Korea which is experiencing contraction again. Then, Taiwanese manufacturing also continued to experience contraction for three consecutive months.
Then, the Caixin PMI from Panda Country showed an unexpected acceleration in activity in December 2023, in contrast to China’s official PMI which was released on Sunday (31/12/2024) and showed it was still in contraction territory for three consecutive months.
Meanwhile, China’s mixed economic prospects also continue to cloud the prospects of its main trading partners. Then, employment remains a significant challenge. The business world also expressed concern about the future and remained cautious in areas including hiring, purchasing raw materials and inventory management.
China in recent months has also introduced a series of policies to shore up its weak post-pandemic recovery. However, China has also struggled to gain momentum amid a severe property slump, regional government debt risks and weak global demand.
For the record, the manufacturing purchasing managers’ index (PMI) from S&P Global for the Asean region fell to 49.7 in December 2023, from the previous month’s 50. Meanwhile, supporting data shows that four of the seven Asean countries in survey participants noted weaker manufacturing conditions.
China’s Recovery Effect is Uneven. Then, South Korean exports in December 2023 also increased although at a slower pace. This is because weaker Chinese demand offset strong global sales of semiconductors.