Current Situation and Trend of Coatings Market in Asia-Pacific Region

The Asia-Pacific region is the largest paint market in the world and has been growing faster than the market for many years. Therefore, it is also considered as the most important paint market in the world. The Asia-Pacific region is a vast region with the largest and most dynamic economies in the world, including China, India, Japan, Korea, Indonesia, Australia and other countries. It is not only the world's largest market, but also continues to surpass the global paint market online coatingol.com.

According to Orr& Boss estimates that the size of the Asia-Pacific coatings market in 2018 is 68.4 billion US dollars and 22.7 billion litres. By contrast, Orr& Boss estimates the global paint market to be $151 billion and $42 billion litres. In 2018, the market value of coatings in the Asia-Pacific region increased by 6.6% and the turnover increased by 3.4%. In recent years, its growth rate has slowed down, mainly due to the slowdown of China's economy. However, this growth rate is still higher than the global paint industry's average growth rate of 5.4% and sales growth rate of 2.8% in 2018. The main drivers of growth are similar to those in other parts of the world, including GDP, construction activities, industrial production and automobile manufacturing. The key parts of the market include decoration, general industry (GI), powder, industrial maintenance and protective coatings (IM& PC) and wood. These five parts account for 80% of the value and 88% of the quantity. The largest coatings market in Asia is China. It occupies more than half of the Asian paint market share and value. Over the past few years, China's paint market has been relatively stable. The main change is that India and Southeast Asia have begun to grow faster than other markets, surpassing Japan and becoming the second and third largest paint market in Asia. The growth rate of Coatings Markets in these countries is generally directly related to the growth rate of these economies: the Indian economy and the economies of Indonesia and other Southeast Asian countries are growing rapidly.

Emerging market countries'coatings market performance is quite good. As mentioned earlier, South and South-East Asian countries, such as India, Bangladesh and the Philippines, have been experiencing high growth rates. This trend is expected to continue. In fact, India and South Asia are expected to grow at higher rates in the future.

Over the past few years, China's economic growth has slowed down, but it is still higher than other large economies in the world. GDP grew by 6.6% in 2018. From 2018 to 2023, the annual compound growth rate of China's GDP is expected to be 5.9%. These growth rates are lower than China's previous GDP growth rates. For example, from 2005 to 2010, China's economy grew at an annual rate of 11.3%. Economic slowdown is the natural result of China's growing economic maturity.

China's economic slowdown is particularly prevalent in manufacturing. China's manufacturing sector contracted slightly at the end of 2018, according to the China Manufacturing Purchasing Managers Index (PMI). This reflects several important manufacturing sectors in China. For example, automobile production units fell by 4.2% in 2018. This is the first time in more than 20 years that the output of China's automobile industry has declined.

PMI index below 50 indicates that manufacturing industry is shrinking, and above 50 means that manufacturing industry is expanding. China's PMI has rebounded, and the index is now over 50 and expanding. This reflects China's economic and paint market expectations for the future. It is expected that with the sustainable development of pickup and manufacturing industries and the overall economy, China's paint market will grow at a rate of more than 5% in 2019. In addition, it should be said that China's economic slowdown may be exaggerated. In 2018, China's economy and manufacturing industry expanded as a whole, but not as much as expected earlier this year. This creates a "bullwhip effect" in which manufacturers and construction companies have to adjust their inventory levels at every step of the process. All this has led to a slower expansion of China's paint industry than in recent years. It is estimated that the sales growth rate of China's coatings industry will be 2.5% in 2018. By 2023, the annual composite growth rate of China's coatings market is expected to be close to 3% to 5%. As the second largest coatings market in Asia, Indian coatings market accounts for about 12% of the whole Asian coatings market. It is the fastest growing Asian market with neighbouring South Asian countries such as Bangladesh, Myanmar and Pakistan. The rapid growth rate is largely due to the rapid expansion of the overall economy. Among Asia's major economies, India's economy grew fastest in 2018, reaching 7%. India's GDP is expected to grow at an average rate of 7.6% by 2023. India's industrial production grew by 5.4% in 2018. All this has led to a faster growth in India's paint and paint sector than in other parts of the region. Orr& Boss estimates that India's paint and coatings sector will grow at an 8% rate in 2018 and is expected to continue to grow. Like India, the economies of Bangladesh and Myanmar are also growing rapidly. It is expected that by 2023, Bangladesh's economic growth rate will exceed 7%, and Myanmar's economic growth rate will be between 6.5% and 7%. Overall, these economies and paint markets are relatively small, but they may offer some growth opportunities. The anticipated growth rate of the paint market in Bangladesh is 10% per year. Japan and Korea are important Coatings Markets in Asia, with large manufacturing bases in automotive, chemical, household appliances and electronic products. Given their maturity, these economies tend to be more stable, more like the paint markets of North America and Western Europe.