Since 2017, global economic growth has remained stable and improved. Looking ahead to 2018, the world economy will maintain a steady recovery thanks to a marked recovery in global trade and increased investment in developed and emerging markets. In an interview with China industry daily, experts from sadie think tank predicted that the world's industrial growth rate will keep growing in 2018.
World industrial production will keep growing
The global economy has performed relatively strongly in 2017, which is higher than the same period in 2016. U.S. economic data have generally improved, European economies have performed well, and some Asian economies, led by China, have maintained steady growth. But growth remains weak in many countries and inflation remains below target in most advanced economies. Commodity exporters have been particularly hard hit. Although the short-term risks are roughly balanced, the medium-term risks are still to the downside. To sum up, it is expected that the global economic growth rate will be around 3.5% in 2018 and the global economy will maintain a steady recovery.
Experts at the sadie think tank say world industrial production will keep growing in 2018.
Global manufacturing growth will slow. Jpmorgan's global manufacturing purchasing managers' index rose to a two-year high of 53.5 in October from 53.3, driven by the fastest expansion in output and new orders in nearly two years. PMI readings improved in 19 of 48 countries during the period, but remained in contraction in 27, mostly in Asia. Global manufacturing is expected to grow at a low rate in 2018.
Emerging industries will continue to grow for a long time. After the international financial crisis, countries around the world have stepped up efforts to develop emerging technologies and industries, and strive to create new economic growth points by developing new technologies and fostering new industries. Artificial intelligence, virtual reality, blockchain, cloud computing, fog computing, quantum computing and other technological hotspots continue. It is expected that in 2018, countries will step up plans and policies to strengthen deployment of core technologies, top talents, standards and norms, and strive to take the lead in the new round of international scientific and technological competition.
Global direct investment will rise slightly. According to the UN conference on trade and development's global investment trends report released in October, global foreign direct investment (FDI) is expected to rise 5 per cent in 2017 from 2016 to nearly $1,800bn, but still below the peak before the 2008 financial crisis.
In regional terms, FDI inflows in Africa is expected to return to growth in 2017, rising to $65 billion, developing Asia will grow by 15%, to $51.5 billion, Latin America and the Caribbean are expected to decline 10%, to $130 billion, transition economies moderate growth from around $80 billion, developed countries are stable at around $1 trillion. It is expected to increase to $1.85 trillion in 2018.
Global trade growth will slow slightly. Looking ahead to 2018, trade growth cannot offset weak base year growth; The federal reserve is gradually raising interest rates, the European central bank is expecting quantitative easing in the euro zone, and monetary policy in the developed world is expected to tighten. Policies such as China's fiscal expansion are likely to be tightened to prevent the economy from overheating. Global trade growth is expected to slow to about 3.2 percent in 2018.
Industrial growth is highly differentiated
Experts say industrial growth in major countries and regions will be sharply divided in 2018.
American industrial production will grow steadily. The institute for supply management's manufacturing index came in at 58.7 in October, slightly below expectations of 59.5. The ISM manufacturing index came in at 60.8 in September, the highest since May 2004. On a separate measure, the ISM's index of new orders in October was 63.4, up from 64.6. The ISM's manufacturing employment index rose to 59.8 from 60.3 in October. The ISM manufacturing price payment index for October was 68.5, with expectations at 67.8, up from 71.5. The final PMI of Markit manufacturing in October was 54.6, the highest since January. The forecast was 54.5, while the preliminary reading was 54.5. The final value in September was 53.1. U.S. industrial production is expected to grow steadily in 2018.
Japanese industrial production will rise slightly. Japan's manufacturing PMI came in at 52.8 in October, the 14th consecutive month of expansion, according to Nikkei/Markit data. Recent data have shown a slight decline in exports and industrial production, but a tight labor market and rising business investment will keep the economy on track for growth. Japan's industrial production is expected to grow slightly in 2018.
Industrial production in the eu will accelerate. Eurozone manufacturing PMI rose to 58.5 in October, the highest reading since February 2011, according to Markit. Industrial production in the eu is expected to accelerate in 2018.
Brics industry will continue to expand. The brics manufacturing sector is highly fragmented. India's manufacturing PMI fell back to 50.3 in October, but was at an expansionary level for the third month in a row. China's manufacturing PMI came in at 51.0 in October, marking the fifth consecutive month of growth in the sector. Russia's manufacturing PMI fell to 51.1 in October, a four-month low, but it was the 15th consecutive month of expansion. Brazil's manufacturing PMI rose to a five-month high of 51.2 in October. Industrial production in the brics countries is expected to continue expanding in 2018.
Industry in asean countries will continue to grow. Asean's manufacturing PMI came in at 50.4 in October, up from 50.3 in September, the third consecutive month of expansion. Despite strong demand from asean manufacturers, manufacturers have already experienced a series of production problems, with supply chain efficiency and purchasing activity falling back and the asean supplier lead time index falling 1.2 points. Asean industrial production is expected to keep growing in 2018.
Intelligence accelerates industrial recovery
In recent years, the global economy has been wandering in the trough, partly due to the economic development cycle. In 2018, the pace of global economic recovery will not be too fast, and the global industrial recovery will be hampered by the overall economic situation and overcapacity.
At present, the world's coal, oil, natural gas, iron ore, steel, aluminum, glass, cement, ships, appliances, automobiles and other industries are seriously surplus, and some production capacity is still growing. Global energy surplus overall 8%~14%, steel surplus 18%~24%, iron ore surplus 12%~18%, electrolytic aluminum surplus 15%~20%. Subsidies and other types of support from governments or government-backed institutions can distort markets, exacerbate global overcapacity and constrain economic development.
Sadie think tank said the new industrial revolution dominated the new pattern of manufacturing. With the continuous breakthroughs in artificial intelligence, big data, Internet of things, cloud computing, robotics, 3D printing, biotechnology and other technologies, and the "re-industrialization" strategy launched by developed countries after the 2008 international financial crisis, the global industrial development mode is changing from automation to intelligence. The new industrial revolution will shift from the single improvement of social intensive production efficiency to the improvement of demand matching efficiency, so as to meet the ever-changing consumption demand under the diversified, fast-food and personalized consumption trend. The new industrial revolution will hit almost every industrial sector in all countries. The breadth and depth of these changes indicate a complete transformation of production, management and governance systems. The global manufacturing forces will also take place a major strategic adjustment.
In response to the new situation of world industrial development in 2018, according to the report of the 19th national congress of the communist party of China (CPC), saidi think tank suggested that global manufacturing trends should be tracked and studied. Deepen supply-side structural reform; Accelerate the building of an innovative country; We will accelerate the layout of the global industrial chain.