India, ASEAN are promising markets that could reduce China dependence: Economist

Robert Koopman, center, at the World Knowledge Forum organized by Maekyung Media Group. [Photo by Lee Seung-hwan]

Countries should make efforts to secure new investment outlets and alternative supply networks instead of relying on China as forecast suggests that the world’s second-largest economy will shift its focus from exports to its own market for growth, according to economists on Wednesday.

Robert Koopman, Hurst Senior Professorial Lecturer at the American University School of International Service, projected that China, currently facing a slowdown in growth, will shift its emphasis from exports and investments to domestic consumption and internal growth from 2024.

His remarks were made during a session titled “Global Economy Outlook 2024” at the World Knowledge Forum organized by Maekyung Media Group.

Koopman, former chief economist at the World Trade Organization, noted that China’s appeal as an investment destination, which once attracted large-scale investments from multinational companies, will diminish over time.

Koopman, former chief economist of the World Trade Organization, suggested that the Association of Southeast Asian Nations (ASEAN) and India will take over China’s role and drive the global economy from 2024 onwards.

He said that developing countries like India, Indonesia, and Malaysia have downward risks such as debt, but are headed toward robust growth and that they will drive global growth moving forward.

William Lee, chief economist at Milken Institute, echoed Koopman’s view.

He noted several countries are already diversifying their supply chains away from China to other Asian markets. Lee also recommended considering investment strategies such as investments in Mexico, which is grabbing attention as supply chains centered on North America are reshaped.

In another session titled “Global Money Movement Outlook,” experts noted that the global economy will likely experience a “soft landing” or a gradual slowdown in growth in the coming year.

“Since manufacturing has already passed its lowest point, the likelihood of a rolling recession or a soft landing has increased,” New York Life Investment Management chief investment officer Jae Yoon said.

By region, experts raised concerns about the economy in Europe, predicting a mild economic downturn next year due to the prolonged Russia-Ukraine war.

Par Nuder, Sweden’s former minister of finance, took Germany’s indicators as an example, noting that they are lower than expected and that investors should be cautious about how the German economy will move.

When it comes to promising investment destinations for the next five to 10 years, experts pointed to the Japanese stock market, high-yield bonds, and commercial real estate.

“Commercial real estate in the United States and Europe has been stagnant for the past 10 years so there may be attractive investment opportunities in the future,” Yoon said.