Asia Economist and CEO, Centennial Asia Advisors

Manu Bhaskaran

Asia Economist and CEO

Centennial Asia Advisors

At Centennial Asia Advisors, we tell it like it is. We have no vested interests, no need for a China wall, and no reason to skew our outlook any other way. With over 30 years experience covering Asia’s political economy, you can be sure our conclusions and analyses are based on the unadulterated facts. Through years of fine-tuning our research methodologies, we deliver a quality of macroeconomic analysis few other houses can match.

Centennial Asia Advisors is an independent research and advisory firm that works with governments, multilateral institutions, financial firms and leading MNCs.

Economic Policy and Strategic Advisors

Macroeconomics

<ul>
<li>Asian exports have become more concentrated in the past decade, both in terms of a narrower set of export partners, as well as lower levels of diversification of export products. </li>
<li>While some of this concentration is driven by benign factors, reduced trade diversification comes with key risks that have become more salient in the current geopolitical environment. </li>
<li>Government strategies in the region are underway to remedy some of the downsides, and this will be a key component in the broader trend of supply-chain realignments in the region.</li>
</ul>


Asian exports have become more concentrated in the past decade, both in terms of a narrower set of export partners, as well as lower levels of diversification of export products. 
While some of this concentration is driven by benign factors, reduced trade diversification comes with key risks that have become more salient in the current geopolitical environment. 
Government strategies in the region are underway to remedy some of the downsides, and this will be a key component in the broader trend of supply-chain realignments in the region.


Regional Economics: Reduced Trade Diversification Implies New Economic Strategies

<ul>
<li>Indonesia's 5.1% growth in 1Q24 was underpinned by a larger contribution by public expenditures due to election financing and state-led capital projects</li>
<li>Net exports, however, entered contraction as the economy's reliance on commodities and China as an export market start to take their toll. </li>
<li>Even if headline growth remains stable for the year, the downside risks from a muted trade outlook and domestic policy uncertainty warrant caution. </li>
</ul>


Indonesia's 5.1% growth in 1Q24 was underpinned by a larger contribution by public expenditures due to election financing and state-led capital projects
Net exports, however, entered contraction as the economy's reliance on commodities and China as an export market start to take their toll. 
Even if headline growth remains stable for the year, the downside risks from a muted trade outlook and domestic policy uncertainty warrant caution. 


Indonesia Economics: Steady Growth Due to Public Spending Expansion

<ul>
<li>Malaysia's government announced intentions to hike civil servant salaries by 13% beginning in December 2024. The fiscal impact, we opine, is largely manageable. </li>
<li>There are political motivations behind this move; the unity government coalition will be hoping to win brownie points among the Malay-majority civil servant electorate. </li>
<li>But this move should not be viewed merely as a populist gimmick, the hikes should be seen as responding to the needs of broader civil service reforms. </li>
</ul>


Malaysia's government announced intentions to hike civil servant salaries by 13% beginning in December 2024. The fiscal impact, we opine, is largely manageable. 
There are political motivations behind this move; the unity government coalition will be hoping to win brownie points among the Malay-majority civil servant electorate. 
But this move should not be viewed merely as a populist gimmick, the hikes should be seen as responding to the needs of broader civil service reforms. 


Malaysia Economics: Public Wage Hikes Not Just a Populist Gimmick

<ul>
<li>China’s first quarter growth of 5.3% comes amidst a slew of other positive data releases, including an improvement in fixed asset investments and a turnaround in net exports. </li>
<li>But a closer examination suggests that momentum remains weak; the recovery was boosted by Lunar New Year spending, which showed signs of fading by March. </li>
<li>Overcapacity and trade tensions remain major headwinds for any export-led recovery; even as property sector misery continues to dampen purchaser sentiment.  </li>
</ul>


China’s first quarter growth of 5.3% comes amidst a slew of other positive data releases, including an improvement in fixed asset investments and a turnaround in net exports. 
But a closer examination suggests that momentum remains weak; the recovery was boosted by Lunar New Year spending, which showed signs of fading by March. 
Overcapacity and trade tensions remain major headwinds for any export-led recovery; even as property sector misery continues to dampen purchaser sentiment.  


China Economics: Headwinds Remain Despite Rosy GDP Figures

<ul>
<li>Despite trade and other frictions between Washington and Beijing, the two sides have set up mechanisms for regular high-level exchanges and other guard rails which reduce risks. </li>
<li>However, as more big powers turn hawkish on defence and trade, other Asian exporters may end up being collateral damage from anti-China protectionism. </li>
<li>Closer to home, the ongoing Myanmar conflict is reaching an imminent turning point as the risk of China getting involved increases and the fighting becomes more intense.</li>
</ul>


Despite trade and other frictions between Washington and Beijing, the two sides have set up mechanisms for regular high-level exchanges and other guard rails which reduce risks. 
However, as more big powers turn hawkish on defence and trade, other Asian exporters may end up being collateral damage from anti-China protectionism. 
Closer to home, the ongoing Myanmar conflict is reaching an imminent turning point as the risk of China getting involved increases and the fighting becomes more intense.


Asian Geopolitics: Despite Global Turbulence, Can Asia Enjoy Relative Calm?

Mr. Bhaskaran is a leading Asian economist based in Singapore with more than 30 years of experience in studying economic, political and security issues that shape the business environment in Asia. He co-ordinates the Asian business of Washington DC-based strategic advisory firm, Centennial Group, directing its Asian economic research practice which provides in-depth analysis of macro trends in Asia. He works extensively with investment institutions, government agencies and corporations. Mr. Bhaskaran regularly presents his views on the economic, political and business environment in Asia at business conferences and in-house briefings. He has conducted studies on a wide range of subjects including: consumer finance in Asia; Asian integration; regional and country-specific political and economic outlooks; the Impact of China on Asia; portfolio capital flows in emerging markets, amongst many others. He is as a member of the Regional Advisory Group for Asia and the Pacific of the International Monetary Fund. Mr. Bhaskaran is a regular columnist for The Edge (Singapore) and holds positions in think tanks including being Adjunct Senior Research Fellow at the Institute of Policy Studies (IPS); Vice President of the Economics Society of Singapore, and Council Member of the Singapore Institute of International Affairs (SIIA). Mr. Bhaskaran serves on the boards of CIMB Investment Bank and Japfa Limited.