For a nation that prides itself on punching above its weight in all we do, 2021 has seen New Zealand bobbing and weaving against the ropes somewhat, as we’ve fought the economic impact of an enduring COVID-19 pandemic. We may have been down in some places, but we’re certainly not out as we approach 2022.
ESG initiatives are expected to become ever more important for companies and investors around the world in 2022. We expect many Japanese companies to come to the fore amid this global shift towards ESG, with enhancements in ESG disclosures shedding light on their value creation opportunities amid the current drive towards decarbonisation.
The Singapore economy is on a road to recovery. Although the economy has already rebounded sharply in 2021, we expect the recovery theme to remain intact and continue supporting the Singapore economy in 2022. We see a broadening of growth within Singapore’s key economic engines in 2022, with a sharper recovery expected in the services sector as the economy reopens.
The economic recovery in Asia ex-China is likely to improve significantly in 2022 as regulations are eased, borders are reopened and vaccination rates increase. We anticipate these developments to boost private sector confidence, providing an important tailwind for Asian ex-China growth in 2022.
Asian stocks fell in November on concerns that the spread of the new Omicron COVID-19 variant could derail global reopening plans and delay economic recoveries.
The macro backdrop and robust corporate credit fundamentals remain supportive of Asia credit spreads. As such, we expect growth momentum of many Asian economies to gather pace heading into 2022. Overall corporate credit fundamentals are expected to remain robust, with earnings growth staying strong—albeit at a slightly slower pace compared to 2021.
The just released 3Q CY21 data on aggregate corporate profits in Japan was very positive, as although for the single quarter, the overall corporate recurring pre-tax profit margin declined from the 2Q, as it does routinely for this non-seasonally adjusted data.
Just a few weeks ago I attended my first in-person conference since 2019. Over 40,000 people descended upon Lisbon for Web Summit, one of the world’s largest technology conferences. The event brings together CEO’s and founders of established firms together with start-ups and policymakers to discuss and pitch ideas over the course of a week.
Asian stocks rose in October, with investors remaining focused on rising inflationary pressures and the US Federal Reserve’s tapering plans. The markets’ key concern is China’s economic performance and its impact on the energy and commodity complexes.
Japan’s rapidly advancing medical technology is viewed as a way to address the healthcare sector’s inefficiencies while at the same time offering potential value opportunities.