ASEAN manufacturing situation in 2024

In 2024, Asia’s manufacturing industry has the strongest recovery, with an average PMI index of more than 50%, and it continues to operate in the expansion range throughout the year, becoming an important guide for the stable recovery of the global economy. Africa’s manufacturing industry has recovered better than America and Europe, with an average index of more than 49%. The recovery trend in America and Europe is relatively weak, with an average index below 49%.

According to a report released by S&P Global on January 2, the average ASEAN manufacturing PMI in 2024 was 51.0, and each month remained in the expansion range, showing the trend of continued expansion in the region and its stability and resilience.

In December 2024, the ASEAN manufacturing PMI was 50.7, slightly lower than 50.8 in November, indicating that the industry has achieved a slight improvement. Among them, the manufacturing PMIs of Indonesia, Thailand, Singapore, and the Philippines all operated above 51%, and all increased to varying degrees compared with November; the manufacturing PMIs of Malaysia and Vietnam were both below 50%, both down from the previous month. The index is composed of a weighted average of five main dimensions, including new orders (30%), output (25%), employment (20%), supplier delivery time (15%) and procurement inventory (10%).

The latest data shows that new orders have grown for the 10th consecutive month, driven by strong domestic demand, but international demand remains weak, and new export orders have contracted for 31 consecutive months, becoming the main factor dragging down the total order volume. Overall, both output and new orders have maintained expansionary momentum, with demand and procurement activities increasing, while inflationary pressures have eased. The growth in new orders supported the solid output expansion, with the growth rate in December being the same as in November.

In November, ASEAN’s manufacturing industry improved slightly, with output rising for the second consecutive month. In December, manufacturers increased their procurement activities for the second consecutive month, with the fastest growth since August. However, pre-production inventories fell for the sixth consecutive month, indicating that raw materials are used directly in production. In addition, finished goods inventories also fell for the 20th consecutive month, indicating that finished goods inventory management is still relatively tight.

The data showed that price pressures eased significantly in December, with inflation rates for input costs and output prices retreating from their upward trend in November, easing operational burdens for businesses. However, despite rising business demand, employment levels fell slightly for the second consecutive month.

ASEAN manufacturing remained optimistic about the output outlook for 2025, but the confidence level fell to an eight-month low and remained below the long-term average. Maryam Baluch, an economist at S&P Global, said that ASEAN manufacturing achieved a small increase at the end of 2024, and the composite index remained stable in December, with improved demand supporting the growth of production and procurement activities. Despite increased business demand, the employment rate continued to fall for the second consecutive month. In addition, although the output outlook for 2025 remains optimistic, it has weakened slightly. New order growth remains moderate and heavily dependent on domestic demand, while weak international demand continues to hinder growth.