- As a key player in the global supply chain, China’s economic progress will have an impact on the future direction of the world’s largest trade bloc, the Regional Comprehensive Economic Partnership, and the global economy.
- Several secular trends are paving the way for growth in Asia, including digitalisation, cloud computing and e-commerce.
- Identifying those companies with the potential to generate consistent, solid growth, supported by durable growth trends, will be key for successful investing.
Evolving global trade patterns
It has been more than a year since COVID-19 was declared a global pandemic. The start-stop lockdowns that followed the first wave of the coronavirus outbreak made it particularly tough for many businesses and individuals to adapt.
That said, global trade remains on the path of growth and development. In November 2020, 15 countries in the Asia-Pacific region signed the Regional Comprehensive Economic Partnership (RCEP) agreement. They include the 10 ASEAN members1 together with China, Japan, South Korea, Australia and New Zealand.
It may be considered early days before the long-term benefits of the trade agreement become apparent, but the RCEP agreement in itself has created the largest free trade bloc in the world. The RCEP member countries together account for close to a third of the world’s population and gross domestic product.2
China easily stands out among its RCEP peers due to its size. Being a key player in the global supply chain, China’s economic progress will have an impact on the future direction of the trade bloc and the global economy.