Global manufacturing to grow in 2024 – but only because of China
9 September 2024 
The global manufacturing industry will expand by 0.6% in 2024, with stronger growth expected in 2025 and beyond, according to a new report from Interact Analysis. However, without China – which is predicted to grow by 2.4% this year – global manufacturing output would decline by 0.9% in 2024, emphasising the critical role that China plays in global manufacturing.
In its quarterly Manufacturing Industry Output (MIO) Tracker report, Interact says that several key European manufacturing economies will face significant downturns this year. The region is grappling with the after-effects of energy crises, supply chain disruptions, and the economic fallout from geopolitical tensions – particularly, the war in Ukraine. As a result, Europe’s manufacturing output is expected either to stagnate or to decline at a country level, making it one of the world’s worst-performing regions. This highlights the region’s vulnerability to external shocks, according to Interact, and underscores the urgent need for strategic investments in energy independence and industrial modernisation to ensure longer-term resilience.
The US, although facing a slowdown, is not expected to experience as severe a downturn as Europe. This is due, in part, to the Biden administration’s large investment in infrastructure. However, the upcoming presidential election may affect the country’s growth prospects.
The Asia-Pacific region – particularly South Korea, Singapore and Taiwan – is poised to play a pivotal role in the recovery of the global manufacturing sector. These three countries are expected to experience a significant resurgence as the semiconductor industry regains momentum.
Drilling down to machinery manufacturing, Interact predicts the sector will have a challenging year in 2024. In Europe, it is expected to stagnate or even decline – notably in Germany and Italy. This is being driven by several factors, including increased competition from lower-cost producers in Eastern Europe and Asia, high interest rates, the energy crisis in Germany, and inflation which is stifling investment.
Some regions, especially in Asia, may see better performance in the machinery sector due to investments in more advanced manufacturing technologies and automation, which are expected to improve productivity and production for machinery sectors.
“Our outlook from 2025 to 2028 is slightly better than last quarter,” reports Interact Analysis CEO, Adrian Lloyd.
