FUKUTOMI GAZETTE – The outlook of 2024

Original by Dr. Steve Wong

December 29, 2023

The year 2023 can be considered a challenging year. Many people expected that with the end of the pandemic, the global economy and social conditions would return to normal and 2023 would be better than 2022. However, it turned out that many countries faced high-interest rates, excess production capacity of prime materials, high levels of inventory, and an economic slowdown in the Mainland Chinese market due to the bursting of the real estate bubble 📉 Additionally, geopolitical factors such as the Israel-Palestine conflict in the Middle East and the ongoing war between Russia and Ukraine have caused supply imbalances, stagnant economic growth, social unrest, and political instability.

Based on the current environment, predicting what will happen in 2024 is difficult. Looking at the situation of the Russia-Ukraine conflict, which has been ongoing for about two years, has already resulted in hundreds of thousands of deaths and the depletion of significant resources. There are currently no signs of a ceasefire. The main issue is that Russia possesses extensive resources. At the same time, Ukraine has the support of Western countries, resulting in evenly matched forces between the two nations. The war is believed to continue for an unknown period, without knowing when it will end. As for the Israel-Palestine conflict, which was triggered in October 2023, it has had a more significant impact on industry operations. Shipping companies are reluctant to use the Suez Canal and the Red Sea, opting to take longer routes around South Africa, significantly increasing shipping costs. The diversion of oil tankers has also increased costs, resulting in higher energy and chemical materials prices. The conflict has escalated uncontrollably and has now developed into clashes between Islamic countries and the countries supporting Israel. Similarly, the current situation shows no signs of reconciliation.

Furthermore, China, the world’s second-largest economy, has been a persistent threat to economic development. Recently, its economy has faced stagnation, partly due to weakened domestic and international demand and excess production capacity for many prime materials and goods, leading to economic contraction and high unemployment. Many foreign investments have shifted away from China, with some directing investments towards India and other Southeast Asian countries due to a lack of alignment with China’s current ideological direction.

Despite its rapid development and growth potential, India faces territorial disputes and conflicts with China, leading the Indian government to halt visa issuance to Chinese citizens. The development in India, as a result, has excluded Chinese involvement. Disputes have also arisen with the Philippines and Indonesia over coastline issues in the South China Sea, posing ongoing tensions. The reunification of Taiwan remains a firm goal for China, and 2024 adds further complexity with the interference of the United States and other nations. Additionally, 2024 is an election year for Taiwan and the United States, introducing more variables to the situation.

Undoubtedly, 2024 will be full of challenges, and we must prepare cautiously to face its arrival.

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