The Bank of Asia said China will remain the biggest growth engine of the Asian and world economies despite the slowdown.
The Asian Development Bank (ADB) raised its forecast for economic growth in Asia from 4.8% in December 2023 to 4.9% in its latest report. On the Vietnamese side, ADB forecasts economic growth in 2024 to be 6%, while 2025 will be better with 6.2%.
Despite the weakness, China’s economy remains the largest contributor to growth in the continent and the world. This economy is even more important in the near future.
ADB also specifically assessed China’s ability to generate “dynamism” with many neighboring countries. China now accounts for 18% and 48% of global and Asian GDP, respectively, based on purchasing power parity exchange rates. ADB forecasts that the global No. 2 economy will grow GDP by 4.8 percent in 2024, below the government’s target of “about 5 percent.”
Ấn Độ được đánh giá có khả năng thay thế Trung Quốc, quốc gia Nam Á đã phát triển với tốc độ nhanh nhất trong 6 quý gần đây, thậm chí vượt qua kỳ vọng với mức tăng trưởng 8,4% trong quý 4/2023.
Tầm quan trọng của Ấn Độ đối với tăng trưởng trong khu vực đang ngày càng tăng, ADB ước lượng tăng trưởng kinh tế nước này sẽ cao nhất trong khu vực, ở mức 7% vào năm 2024 và 7,2% vào năm 2025.
Why do Chinese and Indian economic indicators get attention? According to the ADB, most major economies have slowed growth this year. U.S. GDP will fall to 1.9% from last year’s 2.5%, and Japan’s GDP will grow by just 0.6% from 1.9% in 2023.
Since 2020, ASEAN has surpassed the EU as China’s largest trading partner. For Vietnam, China is the 2nd largest export market after the US. Consumer demand in the billion-person market is an ideal condition for Vietnamese enterprises to maintain commodity export channels.
At the same time, the processing and assembly industry in Vietnam is less worried about supply chain disruption. For example, the whole textile and footwear industry depends largely on Chinese raw materials, especially enterprises in Ho Chi Minh City. HCM has an import level of up to 90%.
Vietnam’s basic industries, such as fertilizers, plastics, chemicals, machinery, iron and steel,… without ample supply from China it would be impossible to function. When the economy is in recession, factories across the border cut production, domestic businesses will suffer from increased costs.
On the other hand, China’s current economic situation is a meaningful lesson for Vietnam. The country is going through a period of restructuring, changing development dynamics, suffering great consequences from real estate and construction,… but still standing.
It is the same real estate, but the contribution of this sector to the Chinese economy is always twice that of Vietnam with a dynamic private enterprise system; It is the same export, but China has always achieved a huge trade surplus.
These are the reasons that have helped China withstand years of upheaval from COVID-19, the Russia-Ukraine war and the economic crisis. Moreover, the fundamental differences between the two economies are the competitiveness of domestic firms, the role of foreign firms, and the dynamism of local governments.
According to the Business Forum
