Global fashion industry faces a changing environment, with an economic downturn and protectionism threatening to mark the development of the two biggest world economies. Twenty years ago, China was the seventh biggest economy, post World War, globalisation led a move to the Western world. Twenty years later, China and India, the two largest powers in the world, threaten to revert globalisation and doctrines deemed to belong to the past come back to political speeches. Brazil and Russia, which alongside China and India promised to be growth motors at the beginning of this century, have wavered, only India reached the expected growth rates.

Global fashion industry faces a changing environment, with an economic downturn and protectionism threatening to mark the development of the two biggest world economies.

Reversal of globalisation leads to new growth centres

Twenty years ago, China was the seventh biggest economy, post World War, globalisation led a move to the Western world. Twenty years later, China and India, the two largest powers in the world, threaten to revert globalisation and doctrines deemed to belong to the past come back to political speeches. Brazil and Russia, which alongside China and India promised to be growth motors at the beginning of this century, have wavered, only India reached the expected growth rates.

The five economies that will grow the most in 2019 are: Macao, Malta, Cyprus, Slovakia and Ireland, with peaks fluctuating between 4 and 6 per cent. The United States, however, will record moderate ascent of 2.5 per cent, four tenths below 2018, in part due to the tax reform driven by Donald Trump.

Europe’s growth to slow down

The Eurozone, will slow down at 1.9 per cent, one tenth below 2018 and, while Germany and France will maintain growth rates, Italy and Spain will slow down two and five tenths, respectively.

As for emerging economies, the best growth perspective is for Yemen, where it is expected to rise 14.7 per cent. The country, deep into a humanitarian crisis due to civil war, will see its economy relatively lifted thanks to the increase in the price of oil. Libya, Dominican Republic, Ethiopia and Rwanda will complete the top five. India is placed in seventh position, with a rise of 7.4 per cent, while China falls to 22th position, with a growth of 6.2 per cent, below 6.6 per cent in 2018 and 6.9 percent in 2017.

Global commerce will slow down as well. In September, the WTO lowered its growing forecasts to 3.7 per cent for 2019, two tenths below 2018’s figure. The organisation, which expects a growth of the economy of only 2.9 per cent, underlines in its report that the hardening of monetary policies and protectionist threats affected predictions.

A year of change

This fiscal year will be the key for many countries. On one hand, Trump and Xi Jinping trade battle, even in the truce, will impact economic development of China and India. China’s manufacturing PMI closed below 50 points in December for the first time and Shanghai’s stock market suffered several corrections during the fiscal year.

The United States’ GDP, started to slow down, once the effects of Trump’s tax reform wear off, with an increase of 3.5per cent in the third quarter, compared to 4.2per cent in Q2.

Tensions in emerging markets like Brazil, Russia or Turkey, alongside the continue terrorist threat in Europe and the refugee crisis will mark the agenda during the year where many countries have their future at stake.