Asia-Pacific exports rise on tech boom, supply-chain shifts – Fitch

Asia-Pacific (APAC) exports are gaining momentum, fueled by a tech boom and deepening regional integration, according to Fitch Ratings. The surge in artificial intelligence (AI) investments, coupled with rising demand for consumer electronics and electric vehicles (EV), is boosting exports.

South Korea and Taiwan, leading producers of advanced AI chips, are increasing production to meet this demand. While China remains a key player in global supply chains, rising labour costs and trade tensions are pushing multinationals to diversify.

This shift is expected to benefit APAC economies with strong manufacturing ecosystems, potentially boosting economic growth and credit metrics across the region. However, risks such as trade restrictions and market slowdowns could temper the outlook.

“We expect the solid export performance to elevate APAC’s economic growth prospects, which should be further boosted by investment inflows amid supply-chain diversification and improve credit metrics for some Fitch-rated APAC economies.” Fitch said. “However, we do not expect any sovereign rating changes in the near-term as a direct result of the strong exports. Improvements in metrics are likely to be gradual and the export outlook is subject to significant risks, including a sharper slowdown than we expect at key destination markets, like the US, EU and China, a resurgence in supply-chain disruption as well as the possible imposition of stricter trade restrictions following the late 2024 US elections.”

Attribution: Fitch Ratings

Subediting: Y.Yasser