Coronavirus Aftermath for Shifting Market Frontiers: Asian Century Fast Forward

Euromonitor International forecasts that Asia Pacific will increase its share of global consumer expenditure by almost 1.2 percentage points in constant terms to hit the 30% mark in 2020. Real global consumer expenditure value is expected to decline by 5%, while Asia Pacific’s consumer expenditure will decline by only 1%, the smallest contraction regionally, resulting in an unprecedented jump for the region in the share of global consumer expenditure. For comparison, during the Global Financial Crisis in 2008-2009 Asia increased its share by 0.8 percentage points only.​

Asia was the first region to encounter Coronavirus (COVID-19) and despite being the most populous region has seen relatively low numbers of cases and deaths. South Korea and Hong Kong are exemplary countries that appear to have managed to tame the virus even when relaxing COVID-19-related restrictions. Major Asian economies are expected to weather the COVID-19 recession better compared to their Western counterparts due to better-managed outbreaks and lesser losses in consumer income.

Asia Pacific’s Real Annual Percentage Point Change in Global Consumer Expenditure Share: 2000-2040

Source: Euromonitor International from national statistics/Eurostat/UN/OECD. Note: Data are forecast for 2020 onwards.

Asia to become the largest consumer market in 2022

In 2022, Asia is forecast to become the largest consumer market globally.​ Over 2020-2022, the growth will be mainly driven by China, India and Indonesia. These countries together will account for 88% of the absolute value growth in consumer expenditure, indicating that major opportunities for businesses will lie in these geographies. Thus global businesses that have a strong presence in the region and a deep understanding of Asian consumers will be able to better mitigate the losses that they will suffer in the Americas and Western Europe this year where consumer expenditure is forecast to drop by 5-6% in real terms.

Real Consumer Expenditure Growth by Geography: 2015-2025

Source: Euromonitor International from national statistics/Eurostat/UN/OECD. Note: Data are forecast for 2020 onwards.

Over 2022-2040, Asia is expected to further increase its share of global consumer expenditure by around 0.5 percentage points per annum on average. By 2040, Asia will account for 40% of global consumer expenditure. As a result, we will see all major multinational companies putting increasing effort and emphasis into satisfying Asian consumers.​