According to a report from the wall Street Journal,"Asia is hoping that a rebound of developed economies,will restore their economies to a healthier growth trajectory".
But data released Thursday, the first of the new year, shows that demand from the U.S. and Europe is playing a less important role in many Asian nations than in the past".
Purchasing managers indexes, a proxy for gross domestic product, signaled that manufacturing activity in the region continues to expand. The pace of expansion, though, slowed in some countries and export orders remained generally weak, signaling a pickup in the U.S., Europe and Japan is failing to jump-start Asia's export-dependent economies.
HSBC's China PMI slipped to 50.5 in December from 50.8 in November, a day after China's official PMI fell to 51.0 in December from 51.4. Any result above 50 indicates expansion, while one below that shows contraction.
The "new export orders" subcomponent of the PMI contracted. That has confounded some observers, who were expecting stronger numbers given a recovery in the U.S., which many economists expect to grow by 3% in 2014, and Europe's tentative exit from recession.
"Today's numbers really do point to a structural problem for Asian exports," said Frederic Neumann, a Hong Kong-based economist with HSBC. "The headline numbers suggest steady growth across Asia, but the trade cycle isn't really firing up."
In part, Asia has become less dependent on the U.S. In 2012, 13.6% of East Asian exports went to the U.S., down from 23.8% in 2000, according to the Asian Development Bank. Local demand is playing a larger role in many economies, particularly China, and intra-regional trade has become more important.
Some of the data on Thursday was more positive. In Taiwan, an integral part of global electronics production, the HSBC PMI rose to 55.2 from November's 53.4, its biggest jump since April 2011. New export orders were at a 32-month high. An official PMI for Taiwan also rose, to 53.6 from 52.0 in November. South Korea's HSBC PMI rose to 50.8 in December from November's 50.4.
Taiwan, like South Korea, is more exposed to the U.S. than China. Taiwanese exports account for about three-quarters of GDP, compared with around a quarter for China. Taiwan's solid export orders in recent months might be linked to global smartphone orders, which can be volatile, many analysts say.
Other economies in the region that rely more on domestic demand or export more to China than the West, notably Indonesia and India, also are failing to benefit from better industrialized world demand.
Some analysts said they expected Asia's economies to show improvements in the year ahead as the U.S. consumer becomes more confident. That will benefit countries like South Korea and Taiwan that make electronics, autos and other goods for Western markets.
But others were less sanguine. "One of the key takeaways is that unlike in the past, the correlation between Asian exports and [U.S. manufacturing] has become weaker, suggesting that a lot of the U.S. pickup is domestic-based and hasn't fed through to Asia," Mizuho Securities chief Asian economist Vishnu Varathan said.
