2024 is shaping up to be another interesting and demanding year for global economic and political relations. Volatility, uncertainty, complexity and ambiguity is everywhere and decision makers have to navigate the unknown.
So it may be with some fortune that we welcome the Year of the Dragon. In Chinese culture, this majestic and powerful beast boasts the confident nature and ambitious spirit that policymakers and business leaders are going to need right now, as they try to make sense of the world.
Our colleagues across the globe have been channelling the traits that the Chinese often associate with dragons – courage, tenacity, and intelligence – in order to look ahead to the coming 12 months. Inspired by their conversations with media, clients and contacts they have put together a selection of some bold (yet measured) takes on how China and the rest of the world could interact with each other in the political, economic, sporting and cultural spheres this year.
From Amsterdam: A surprise visit?
The Dutch are a strong European trade partner to China, both at the blue-chip and SME levels. But this trade relationship has been tested by tightening restrictions on Dutch exports of high-tech products to China. The incoming Dutch government could also alter the bilateral dynamics. As the most senior Chinese leadership prepares for its first in-person visit to Europe in almost five years, a visit to the Netherlands could be on the cards.
From Berlin: Dressing for success?
Chinese fashion designers and design elements have been making a splash on the world stage, while Chinese fast fashion platforms are amongst the most popular sources of clothes for young Germans (and many other Europeans). Yet concerns over the sustainability of such disposable fashion, and the rising power of Chinese fashion brands, is likely to prompt further scrutiny from consumers, regulators and local fashion houses.
From Brussels: Economics trumps politics
The EU’s relationship with China will continue to oscillate between competition, threat and partnership. The EU will continue trying to “de-risk” (and not de-couple) its reliance on China by diversifying supply chains and export markets, while enacting protective measures. Chinese greenfield investments into sensitive sectors will also face greater regulatory scrutiny. Such efforts will be constrained, however, by the economic slowdown in the EU and the dependence of the bloc’s green transition on Chinese inputs.
From Hong Kong: Still going global?
More Chinese companies will explore new overseas markets, seeking growth opportunities beyond their ultra-competitive market on the mainland. Driven by the prospect of a larger pool of growth and revenue opportunities, we expect among the next wave heading to foreign shores will include enterprises with innovative artificial intelligence and large-language models.
From Paris: Warm diplomacy, hotter Olympics?
The Dragon will bring warmer French-China diplomatic relations, including celebrations around the 60th anniversary of diplomatic relations and a planned visit to Paris by the senior Chinese leadership. In the sports arena though, competition could heat up as the French Olympics team makes a push as host to finish high up in the medal table, against a Chinese team that has in recent years been a top Olympics performer.
From São Paulo: A dragon’s appetite for Brazilian minerals
The Wood Dragon will show a huge appetite for Brazilian resources – especially lithium and rare earth. We predict that Chinese companies will likely capture two thirds of this market in Brazil this year.
From Shanghai: Chinese tourists find their wings again
Chinese tourists will find their wings again as they continue to venture back to overseas destinations. Yet, flight costs and visa barriers mean that outbound travel will remain below 2019 levels. Domestic tourism looks set to build on last year’s momentum and soar to new heights, in terms of traveller numbers. New domestic travel trends including nature-seeking camping (as opposed to glamping) and budget- friendly city hopping on overnight trains offer a wider range of travel styles to meet any budget.
From Singapore: 4G. Fourth (leadership) generation?
Singapore will potentially go to the polls in 2024. The stakes are high, and the decisions made at the polling booth are likely to profoundly impact the island nation's future and potentially relations with its neighbors and regional leaders, including China. This once-in-a-generation election is set to also usher in a new generation of policymakers who will shape Singapore’s future.
From Washington, D.C.: Balancing competing innovation goals
Congress will continue to drive a combative agenda towards China, focusing on decoupling the economic relationship and restricting access and funding for Chinese companies in sensitive sectors. The Biden administration will seek to balance its interest in policies that welcome some Chinese innovation, particularly in the green economy, while protecting American companies and national security priorities. With an election later in the year, candidates will increasingly focus on U.S.-China relations in what may well be a very close contest.