Asia in charts: Opportunities in a post-pandemic new normal

Key takeaways

• Asia is undergoing an economic recovery, led by mainland China and North Asia. In 2021, the recovery is expected to broaden to the rest of the region
• Asian governments and central banks are expected to continue to support the economies, although with a potentially less expansionary stance
• The pace of recovery could be affected by a slow labor market recovery, hit to household incomes and private sector balance sheets, default and bank asset quality risks as well as debt sustainability concerns
• Fund flows into Asia credit have been strong in 2020, and this is a trend expected to continue in 2021 as global investors intensify their search for yield in a low to negative rate environment
• Asian equities are expected to see a strong bounce back in earnings in 2021’s post Covid environment and the stabilising GDP growth in the region should provide support for the earnings outlook
• Digitalisation in Asia is accelerating, and mainland China continues to lead the world in ecommerce, with forecasted ecommerce revenues in 2020 expected to be more than double that of the US. While the internet sector in mainland China is seeing regulatory uncertainties, digitalisation and overall supportive government policies for the sector should continue to act as catalysts in the medium to long term
• In Asia, nearly half a billion people will be aged 65 and older by 2025 and Asian consumers are increasingly interested in health and lifestyle changes. Evolving socio-economic factors and ongoing institutional support place the healthcare sector in a favourable position for continued growth