The Asia advantage

With its share of global GDP continuing to rise, Asia remains the world's primary growth engine, and according to an annual report released by the Boao Forum for Asia (BFA) on March 24, China and the Association of Southeast Asian Nations (ASEAN) continue to stand out as the region's twin "anchors of stability."

The report was one of two flagship reports on the economic outlook for Asia, integration progress and the region's sustainable development that were released at the BFA Annual Conference 2026.

Held in Boao, a resort town in China's southern island province of Hainan, from March 24 to 27, the conference was themed Shaping a Shared Future: New Dynamics, New Opportunities, New Cooperation. Founded in 2001, the BFA is a non-governmental and non-profit international organization committed to promoting regional economic integration.

Calculated on a purchasing power parity basis, the Asian economy is expected to expand 4.5 percent in 2026, with its share of global GDP rising to 49.7 percent from 49.2 percent in 2025, noted the report, titled Asian Economic Outlook and Integration Progress Annual Report 2026.

China's anchoring role in regional value chains is particularly pronounced, with dependence on China now exceeding 20 percent for ASEAN members, Japan and the Republic of Korea (ROK), the report said, noting that China's role as a regional hub within Asia remains firmly entrenched.

"China is experiencing reasonably fast economic growth. That's achieved through factors including technological innovation and productivity growth," Robert Koopman, former WTO Chief Economist and Hurst Senior Professorial Lecturer at American University, told Beijing Review.

A region on the rise

Despite challenges, Asia's economy remains resilient with a positive outlook, and continues to make contributions to the global economy, international trade and sustainable development, BFA Secretary General Zhang Jun told a press conference on March 24.

According to the report, Asia continues to be the world's premier destination for foreign direct investment, recognized for its resilience and growth potential, with China and ASEAN leading as the most attractive destinations.

The report also highlighted that among 29 key categories of intermediate goods, representing over 85 percent of global parts and components trade, Asia remains the principal global supply center and manufacturing base.

Notably, the report found China leads in 19 out of 22 categories of products within Asia's global value chains.

"China's position as a key node remains solid, and the strengthening of intra-Asian value chains has reinforced the region's central role, a trend unlikely to reverse in the near term," it read.

On the tech front, the report said the global epicenter of AI development is progressively shifting toward Asia. Capitalizing on their substantial digital populations, diverse application ecosystems, and coherent policy frameworks, Asian economies are rapidly evolving from AI followers into frontrunners.

Among the leading echelon, China has achieved full-chain industrial maturity and demonstrated robust capabilities in large-scale deployment, it said.

Sustainable Development: Asia and the World Annual Report 2026, the other BFA report released on March 24, said across the region, China, India, Japan, the ROK and ASEAN countries are developing renewable energy in light of local conditions, with the green economy showing strong growth momentum.

An anchor of stability

Across trade, infrastructure, finance and innovation, China functions not only as a major participant but as a structural hub shaping regional development trajectories.

China is leveraging its vast market advantages to further expand opening up, with a particular focus on advancing an inclusive and mutually beneficial form of economic globalization, Sang Baichuan, Dean of the Institute of International Economy at the University of International Business and Economics, said at the press conference.

"This allows China's large and open domestic market to create more opportunities for other Asian economies and the wider world," Sang said.

Michele Geraci, former Undersecretary of State at the Italian Ministry of Economic Development, told a subforum of the conference on March 24 that China's advantage lies precisely in the strength of its government—the policies it implements can powerfully drive economic development, as exemplified by the 15th Five-Year Plan (2026-30) that outlines key priorities for the next five years.

"There's probably a perception that China is still in the state that it was 15 to 20 years ago, where it was undercutting through cost and pricing capabilities, whereas, in fact, it has moved way ahead of that, and it's now a center for innovation and businesses," Peter Burnett, CEO of the China-Britain Business Council, told Beijing Review, cautioning that clinging to outdated perceptions could cost businesses opportunities.

Koopman noted that China has built formidable competitiveness in manufacturing, while its household consumption has remained relatively subdued. China produces efficiently but has yet to fully unlock the spending power of its own consumers.

For the 15th Five-Year Plan period, rebalancing toward stronger domestic consumption and a more sustainable growth model will require difficult structural adjustments, he said, adding that it is central to the next phase of China's economic evolution—and to the stability of the global trading system as a whole.

Opening wider

This year is the beginning of the 15th Five-Year Plan period. In the outline of the plan, approved by China's top legislature in early March, the country pledges to steadily expand institutional opening up and develop new institutions for a higher-standard open economy.

Hainan stands as a prime example of China's commitment to opening up.

The Hainan Free Trade Port, covering the entirety of the 33,900-square-km Hainan Island, is the world's largest free trade port by area. It launched island-wide special customs operations in late 2025, allowing freer entry of overseas goods, expanded zero-tariff coverage and more business-friendly measures. The move has further strengthened Hainan's role as a high-level institutional platform for opening up.

Speaking at a subforum themed Free Trade Ports: Opportunities and Mission as Gateways for Opening up on March 24, Holger Bingmann, Vice Chairman of the International Chamber of Commerce, said as fragmentation is deepening, Hainan's opening-up strategy is timely and necessary.

The free trade port should function as more than a magnet for Western investment. It should also be a launchpad for Chinese companies seeking to expand into Europe, he added.

Lorenzo Riccardi, Chairman of the China-Italy Chamber of Commerce, told Beijing Review that China's share of global GDP has continued to rise, making it a key hub for investment in Asia.

Since 2023, China has granted visa-free entry to visitors from more than 70 countries, and according to Riccardi, the policy has greatly increased the number of business visitors coming to China. Combined with the free trade port policy and the mobility granted to foreigners, these new initiatives encourage more trade and business, he said.

"China has a stable market, whether in terms of foreign policy or financial opportunities. Foreign companies continue to invest in China, attracted by the stability offered in both policy and security," he continued.

Chi Fulin, President of the China Institute for Reform and Development, told a subforum on the Regional Comprehensive Economic Partnership (RCEP) that China's trade in goods with other participants in the partnership exceeded $1 trillion. Ties under the RCEP are growing ever closer.

The RCEP consists of 10 ASEAN countries, China, Japan, the ROK, Australia and New Zealand, accounting for roughly 30 percent of the world's GDP and population. It is the world's largest free trade agreement.

"Today, the greatest uncertainty in the world lies in uncertain growth. For China and ASEAN, the core issue is how to ensure certainty in growth," Chi said, noting that with the changing geo-economic landscape, the RCEP's role in promoting regional integration and global free trade will only grow more important.

Adding certainty

The Asian Economic Outlook and Integration Progress Annual Report 2026 also warned that Asia's rise is unfolding at a moment of deep global disruption. A shifting balance of power, accelerating technological change and mounting geopolitical tensions have introduced a new level of uncertainty into the global economy.

The push toward low-carbon development demands costly and complex economic restructuring. Demographic change—especially in China, Japan and the ROK—is eroding labor supply and undermining the region's traditional advantages in manufacturing. These forces are compelling Asia to shift toward innovation and domestic resilience in an increasingly uncertain world, the report said.

Within a complex global environment, China is doubling down on expanding domestic demand, advancing technological innovation and transitioning to green growth as its strategic anchors. Data from the National Bureau of Statistics showed that in the first two months of this year, China's hi-tech manufacturing output grew 13.1 percent year on year, while industrial robotics and 3D printing equipment saw output surges of 31 percent and 54 percent on a yearly basis, respectively.

Chi said China's growth needs to be more strongly driven by domestic demand. He emphasized that if China's share of global retail sales could approach its strength in manufacturing, the vast Chinese market would provide the greatest source of certainty not only for the RCEP region, but for the global economy as a whole.

"Only through sustained growth can China, Asia and the RCEP region become the greatest source of certainty in the global economy over the next decade, and play a notable role in regional integration and a new wave of globalization," he said.