10 Best Performing Asia Pacific ETFs in 2023

Ramish Cheema
8 min read

In This Article:

In this piece, we will take a look at the ten best performing Asia Pacific ETFs in 2023, If you want to skip our analysis of the Asia Pacific sector, then take a look at 5 Best Performing Asia Pacific ETFs in 2023.

Asia Pacific is one of the most dynamic and fastest growing economic regions in the world. While the Western world and industrialized nations such as the United States have already developed their economies and squeezed out the maximum growth, countries in Asia still have quite some way to go. Their underdevelopment when compared to European colonial powers in the 1900s and the economic behemoth that is the U.S. is now providing them with sizeable growth opportunities which often attracts some of the most optimistic investors in the world.

Data from S&P Global shows that growth in the Asia Pacific over the past couple of decades has reshaped the global economy. This is because in 2000, APAC accounted for 27% of the world's GDP while this percentage grew to 37% in 2021. While this in itself is important and striking, the true impact of Asia Pacific is expected to come over the next decade and a half. Growth in China and ASEAN countries is expected to further push this share to 42% of global GDP by 2040. In dollar terms, the region's GDP was worth $9 trillion in 2000 and sat at $35 trillion by 2021. Naturally, the growth in share by the APAC region has to come from a reduction in the share that comes from other regions.

Slowing economic growth and the exit of the United Kingdom have ensured that the European Union (EU) continues to lose its share in the global economic pie. The EU's global economic share has dropped from more than a quarter of global economic output (26.5%) in 2000 to less than a fifth (17.9%) in 2021 due to these factors. Finally, America, which is still the largest economy in the world, has seen its share drop from 30% to 24% in 2021, as China's share grew from 3.6% to 18.6% during the same time period. Simply put, the rise of Asia and particularly China has ensured that the latter accounts for a larger portion of the global economy than the EU.

However, these days, the global economic thought process appears to be shifting, even if this shift is temporary. Most hopes about the economy this year were based on China rising after it eliminated its disastrous Zero COVID policy. However, lingering structural problems in the Chinese economy have ensured that this is not the case, as the Asian giant finds growing cracks in its property sector and the population unwilling to spend money due to worries about an unstable economy. China has grown these past few decades not only due to its large population but also due to Western investments in the Chinese sector which have created jobs and allowed China to sell its goods in the world. In fact, it's unlikely that the world's largest consumer technology company Apple Inc. (NASDAQ:AAPL) would be where it is today without China. Apple's chief executive officer Mr. Tim Cook started out at the company as a part of the operations team, and it was his decision to outsource manufacturing to China. This was in the late 1990s, and since then, Apple has been able to create a robust supply chain that allows it to order the manufacturing of complex products and lower costs when compared to America.

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