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“ The Asia-Pacific region has been a key driver of global growth despite international headwinds, political turmoil, trade tensions and conflicts.”
ASIA’ S COMPETITIVE FUTURE
We highlight economic growth rates, trends and forecasts in Asian markets for manufacturers, with selected country reports for 2026.
Image: Shutterstock. com.
Asia is a vital central hub for global manufacturing and the primary driver of international trade. It is also evolving into a major consumption market and has shown considerable resilience in a climate of increasing global trade tensions and volatility.
While Asia is at the centre of the global trade-policy reset, the International Monetary Fund( IMF) believes that it will remain the biggest driver of global growth( contributing about 60 per cent in 2025 and 2026). Asia is also highly integrated in global supply chains so tensions between large economies( such as the U. S. and China) will have a greater impact on the region.
“ The shock from trade tensions has been cushioned by a frontloading of exports ahead of new levies, stronger-than-expected investment in artificial intelligence, ongoing supply-chain reconfiguration within the region, and policy easing in some countries,” commented the IMF in October 2025. However, it also pointed to several risks including the renewed escalation of tariffs and more rules-of-origin restrictions to avoid trans-shipments, further supply-chain disruptions and tighter global financial conditions.
Asia-Pacific region
The Asia-Pacific region has been a key driver of global growth despite international headwinds, political turmoil, trade tensions and conflicts. In its October 2025 forecast, the IMF( International Monetary Fund) believed that growth in the Asia and Pacific region was likely to slow to 4.1 per cent in 2026 from 4.5 per cent in 2025. It also projected that the Association of Southeast Asian Nations( ASEAN) economies would expand by 4.3 per cent in 2025 for a second straight year.
“ Economies in the Asia-Pacific region have been resilient in 2025, posting stronger-than-expected economic growth in the first half of the year amid external and domestic challenges. Nevertheless, higher U. S. tariffs and increasing protectionism will probably reduce demand for Asian exports and eventually weigh on growth in the near term,” said the IMF( International Monetary Fund) in October 2025.
“ Amid these forces, policies should focus on increasing regional integration by reducing barriers to trade and investment and boosting productivity growth with better financial intermediation and allocation of capital. Additional measures to support the services sector, mitigate the impact of population ageing and upgrade policy frameworks are critical for resilient and sustainable growth, and would help prepare for future shocks,” it advised.
26 | ismr. net | ISMR February 2026