The Diverse Landscape of APAC Markets
The Asia-Pacific (APAC) region offers investors a diverse range of opportunities across developed and emerging markets, featuring a unique mix of industries shaped by regional demands and economic cycles.
Despite global challenges like the COVID-19 pandemic and trade tensions, APAC economies continue to demonstrate robust growth potential, often outpacing developed countries.
In contrast to the United States, where certain sectors tend to dominate, APAC markets offer a distinctive constellation of industries such as financials, consumer discretionary, manufacturing, and commodities. This diversity provides investors with a fresh perspective on potential investment opportunities.
Australia, India and China Offer Differences from the United States
- United States
- Australia
- India
- China
United States
Source: MSCI. Indexes are unmanaged and one cannot directly invest in them. They do not include fees, expenses or sales charges. Past performance is not an indicator or a guarantee of future results. See www.franklintempletondatasources.com for additional data provider information.
Australia
Source: MSCI. Indexes are unmanaged and one cannot directly invest in them. They do not include fees, expenses or sales charges. Past performance is not an indicator or a guarantee of future results. See www.franklintempletondatasources.com for additional data provider information.
India
Source: MSCI. Indexes are unmanaged and one cannot directly invest in them. They do not include fees, expenses or sales charges. Past performance is not an indicator or a guarantee of future results. See www.franklintempletondatasources.com for additional data provider information.
China
Source: MSCI. Indexes are unmanaged and one cannot directly invest in them. They do not include fees, expenses or sales charges. Past performance is not an indicator or a guarantee of future results. See www.franklintempletondatasources.com for additional data provider information.
Uncover APAC's Investment Potential
Our in-depth research offers actionable insights into APAC’s economic landscape, investment strategies, and emerging opportunities.
Riding the wave of economic growth
APAC's economic growth often outpaces that of developed countries, providing fertile ground for investors.
Despite the COVID-19 pandemic reshuffling global GDP rankings, APAC economies like China and several ASEAN countries continue to grow robustly, albeit at a slower rate than their historical averages.
However, their growth still outstrips that of the United States. Economies like Australia, Thailand, and Taiwan might lag, but the region overall brims with potential.
- GDP Growth
- Investment Levels
- Debt Levels
GDP Growth
Source: IMF World Economic Outlook, April 2024. Analysis by Franklin Templeton Institute
Notes: The countries included are Australia, Bangladesh, Bhutan, Brunei Darussalam, Cambodia, China, Hong Kong, India, Indonesia, Japan, Lao PDR, Macao, Malaysia, Maldives, Mongolia, Myanmar, Nepal, New Zealand, Pakistan, Philippines, Singapore, South Korea, Taiwan, Thailand, Timor-Leste and Vietnam.
There is no assurance that any projection, estimate or forecast will be realised.
Investment Levels
Source: World Bank, analysis by Franklin Templeton Institute
Note: Normalized Ratio of 1.0 = Global Average. Source: World Bank. Analysis by Franklin Templeton Institute.
Debt Levels
Source: IMF, analysis by Franklin Templeton Institute
Note: Normalized Ratio of 1.0 = Global Average. Source: IMF. Analysis by Franklin Templeton Institute.
We think various countries in the Asia-Pacific region look attractive. Both cyclical and structural factors are expected to bolster Asian bonds and currencies. Cyclical factors include growth differentials and narrowing interest-rate differentials, which should support these currencies against the US dollar. Structural factors include current account surpluses, small fiscal deficits and low levels of debt, with reshoring now an additional structural advantage in certain countries.”
Consumption can contribute to growth
In the journey of a nation's development, investment in infrastructure lays the groundwork for future growth. Once established, consumption often becomes a key driver of economic expansion.
APAC countries, still in various developmental stages, generally exhibit lower consumption shares compared to the consumer-driven US economy. However, this signals ample room for growth.
Consumption Levels Are Healthy and Have Room for Continued Growth
Source: World Bank. Analysis by Franklin Templeton Institute.
Note: Normalized Ratio of 1.0 = 12-Year Global Average.
Currently, Australia is running trade and budget surpluses. In addition, high levels of immigration have contributed to a supportive demographic situation that affords us with an advantage over many of our developed market counterparts. When you combine these strengths with the massive domestic supply of raw materials necessary to power the industries of the future like green energy, we believe that the macroeconomic backdrop is particularly supportive for Australia right now.”
Thriving beyond trade
Despite the global retreat from free trade, APAC markets remain resilient. While US-China trade tensions and protectionist policies make headlines, many APAC economies rely less on trade than other regions. This adaptability underscores the region's capacity to grow independently of global trade dynamics.
APAC Economies Rely Less on Trade Than the Global Average
Source: World Bank. Analysis by Franklin Templeton Institute.
Note: Ratio of 1.0 = Global Average.
Meet Our Investments Brands
Uncover APAC's Investment Potential
The APAC region offers a wealth of opportunities for investors who are willing to embrace the challenges and opportunities of these fast-changing markets and sectors. We believe that by adopting a strategic and informed approach, investors can unlock the full potential of the APAC region.
Overview
Opportunities in APAC markets for today and the next 20 years.
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Future Waves of Opportunity
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