Trade policy changes were most often cited by executives in Greater China and North America as the greatest risk to their economies in the coming year, according to a recent McKinsey Global Survey. It marks the first time since fall 2019 that changes to trade policy reached the top five most-cited issues among surveyed executives. Respondents in Asia–Pacific and Europe have geopolitical instability at the top of their list of concerns, senior partner Sven Smit and colleagues note.
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A table shows the percentage of respondents, organized by region, who selected a particular risk to economic growth as the most significant that their country will face in the next 12 months. The 5 regions are included are Europe, Asia–Pacific, North America, developing markets, and Greater China. The 5 risks assessed are geopolitical instability and/or conflicts, changes in trade policy or relationships, transitions of political leadership, inflation, and domestic political conflicts. In Europe, 49% of respondents selected geopolitical instability and/or conflicts as the biggest potential risk to economic growth in their countries, while 44% of respondents in Asia–Pacific selected the same. In North America, 56% of respondents selected changes in trade policy as the biggest potential risk to economic growth in their countries, while 24% of respondents in Greater China selected the same. In developing markets, the biggest threat highlighted was inflation, at 35%. Overall, the risk most frequently cited across all regions was geopolitical instability and/or conflicts, at 35%, and the risk that was most frequently cited as the most significant varied by region.
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Source: McKinsey Global Survey on economic conditions, 912 participants at all levels of the organization, Nov 27–Dec 6, 2024.
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To read the survey, see “Economic conditions outlook, December 2024,” December 20, 2024.