Global stronghold showcases its resilience

In spite of their many differences, it’s hard not to draw comparisons between China and India. The former has long held the standing of APAC’s number-one economy and geopolitical force, and continues to do so.

Nevertheless, the Chinese economy is navigating a number of challenges, including a real estate downturn, a plateauing population, and an underwhelming restart following its post-pandemic reopening at the beginning of 2023. On the economic front, momentum has been picking up recently. Annualized GDP growth beat expectations in Q3. The People’s Bank of China kept interest rates unchanged at 3.65% during the quarter and took a number of measures to support growth, such as reducing the reserve requirement ratio for some banks. This conservatively stimulative approach appears to be yielding some early results.

Relative strength

India, meanwhile, has been growing at a rapid clip recently and heavily tightening monetary conditions to keep inflation under control, moving in the opposite direction. Growth in Q3 is now set to slow. Lagging expectations as consumer spending succumbs to higher prices and exports are tempered by lower global demand. But the overall picture contrasts quite starkly with China.

These diverging paths aside, both countries and APAC at large are running well ahead of the developed world. Q3’s M&A stats reflect this outperformance. Deal volume has held up far more robustly in APAC than in EMEA and the Americas in recent months.

Notwithstanding China and Japan, APAC is dealing with the same inflationary pressures as other markets in the West, but its indefatigable and increasingly self-sustaining growth momentum is spurring dealmakers on as they strategically position themselves to capitalize on the world’s most dynamic, youthful, and ascendant region. As ever, it would be unwise to bet against APAC’s rising star.

Published in association with Datasite, Deal Drivers APAC provides an in-depth review of M&A activity in 2023, as well as an outlook for the year ahead.

The report is also available on datasite.com.