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APAC Steering Global Growth Amid Trade Turbulence
Industry News- Sep 17,25
Economies with domestic growth drivers are better placed to navigate the trade related uncertainties, says CareEdge Global.
Mumbai
In CareEdge Global’s recent webinar, “Divergent Growth Trends in APAC amid Global Trade Flux,” leading economists and strategists highlighted the relative positioning of APAC economies amid evolving global trade dynamics, with particular emphasis on the key risks and buffers shaping the region’s outlook. They observed that economies supported by strong domestic growth drivers are better placed to withstand current uncertainties, while the prospects for export-oriented economies will largely depend on the fiscal and monetary space available to them.
Speaking at the webinar, the experts highlight that Global trade conditions remain fragile, with the Economic Policy Uncertainty Index at an all-time high and protectionism reshaping supply chains.
Rajani Sinha, Chief Economist, CareEdge Ratings said, “APAC has stood out as one of the world’s most stable and consistent growth regions over the past few decades. Despite the current uncertain environment, several APAC economies still possess structural advantages - ranging from demographic depth and industrial adaptability to rising domestic demand, which positions them better to navigate the uncharted waters ahead. The imperative would be to leverage these structural fundamentals and strengthen long-term competitiveness.”
As global trade tensions evolve, economies with large trade surpluses with the US and those tightly integrated with China face heightened risks. This will be reflected in further volatility in the current account balance of economies in this region. Additionally, exchange rate volatility is a key monitorable, particularly for economies that are integrated in global trade and capital flows.
However, the outlook isn’t entirely bleak. The APAC region retains several structural buffers that could temper external shocks, with the services sector emerging as a key pillar of resilience. In addition, economies within the Asia Pacific have secured a formidable position in the global manufacturing landscape, with one of the highest shares in global manufacturing. Countries such as Vietnam, Malaysia, and South Korea are making progress toward high-value segments of the electronics and semiconductor supply chains. Their shift from cost-competitive production bases to more innovation-driven manufacturing ecosystems reinforces the region’s strategic importance.
From a credit perspective, Asia-Pacific continues to present compelling investment opportunities, underpinned by favourable structural fundamentals. Large and demographically dynamic economies, such as India and Indonesia, benefit from rising per capita incomes and expanding consumer bases, offering a long-term growth narrative that remains intact despite global volatility. Furthermore, sovereign debt levels across a few APAC economies, such as Indonesia and Vietnam, remain manageable, supported by favourable growth-interest differentials. While countries like China and India have higher debt levels; India’s downward debt trajectory aids its credit profile. That being said, the future debt trajectories differ across the region and are expected to be defined by global trade challenges.
Panelists in the webinar note that while APAC economies like Vietnam, Thailand and Malaysia face sharper risks from US-China trade disruptions, India’s large domestic market, robust service export growth, and policy space place it in a stronger position to sustain momentum. Having said that the high tariff rate imposed by US on India is concerning. They mentioned that while India has the advantage of scale, its ability to attract long-term investment will depend on structural reforms that deepen competitiveness, not just short-term policy support.
CareEdge Ratings recently hosted a webinar on “Divergent Growth Trends in APAC amid Global Trade Flux” featuring insights from senior industry experts and the CareEdge team on the evolution of APAC economies’ development paths, challenges, and structural advantages. The webinar featured distinguished speakers such as Ping Chew, renowned global credit rating expert from Singapore; John Beirne, Principal Economist at the Asian Development Bank (ADB), Philippines; and Jeff Ng, Head of Asia Macro Strategy for Asia Pacific at Sumitomo Mitsui Banking Corporation (SMBC), Singapore. The panel was moderated by Rajani Sinha, Chief Economist, CareEdge Ratings and presented by Kiran Kavala and Dr Annie Mahajan.
CareEdge Global
Rajani Sinha
APAC Economies
Global Trade Uncertainty
US-China Trade Tensions
Asian Development Bank (ADB)
Sumitomo Mitsui Banking Corporation (SMBC)
Vietnam Manufacturing
India Economic Growth
Global Supply Chains
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