Strong Recovery Expected in Global Manufacturing Sector for 2025-2028
Strong Recovery Expected in Global Manufacturing Sector for 2025-2028
While 2024 proved sluggish for the global manufacturing sector, a strong recovery is expected between 2025 and 2028. According to a report prepared by Interact Analysis, manufacturing growth is forecast at just 0.6 percent in 2024, but from 2025 onwards the sector will recover rapidly and expand steadily through 2028. Although a slight decline is expected in 2026, an overall positive outlook prevails across the sector.
The weakening of China's economy in particular could have a negative impact on global manufacturing. Since China accounts for a significant share of the world's manufacturing sector, any downturn in that country could directly affect global growth. The four largest manufacturing economies in Europe are currently in a downtrend, but positive signals from the United States toward the end of the year could change this situation.
The U.S. economy is strengthening thanks to declining inflation and interest rates, with increased consumer spending being felt globally. The semiconductor sector, which experienced a decline in 2023, is having a positive effect on markets in South Asia, particularly Taiwan, Singapore, and South Korea. While contractions in global demand and rising cost of living put pressure on the sector, there are notable improvements in consumer spending and post-Covid supply chain issues.
Key Points
Global manufacturing will grow by just 0.6 percent in 2024.
From 2025 onwards, manufacturing output will increase sharply, though a slight decline is expected in 2026.
Weakening of China's economy could have a negative impact on global manufacturing.
The U.S. economy continues to strengthen with declining inflation and interest rates.
The semiconductor sector is showing positive developments, particularly in South Asia.
Improvement signals are evident in consumer spending and post-Covid supply chain issues.