The COVID-19 pandemic has really messed up global trade. In Asia and around the world, there are material shortages and, at least in the beginning, there was also a drop in demand, since we all mostly stayed home and didn’t actually show up at school and work.
There have also been worker shortages, since some also got sick or couldn’t work as they took care of their kids at home. For some companies it meant cash-flow issues—that is, they didn’t have enough money when they needed it—as they couldn’t make enough or sell enough.
By the way, we at McKinsey worked with a lot of these folks to help them with their supply chains during the pandemic, plus plan for when they could both make and sell as they had planned to. We also are helping them plan for the next time—hopefully no time soon—we might have another supply-chain challenge.
K-Pop taking over
Fast fact #1: Korean pop music, or K-pop, is now a huge hit across the globe. BTS, one of the best-known K-pop bands, reached No. 1 on iTunes in more than 65 countries and has over 60 million subscribers on YouTube.
In the past, Asia was largely a recipient of Western culture
Today, cultural flows go in both directions. Asia accounts for 38 percent of worldwide movie box office sales, up from 25 percent just 10 years ago. Avengers: Endgame became 2019’s biggest box-office movie because Asian audiences couldn’t get enough of it.
Asia is becoming more connected
Fast fact #2: Asia accounted for more than 50 percent of total growth in air passengers in the last 10 years.
As Asia grows richer, people there are spending more and become more important globally for brands. They travel a lot more within the region now, instead of only heading to Europe or the US. Before the pandemic, Asia was home to 15 of the world’s 20 fastest-growing airports.
E-commerce is growing
Fast fact #3: Some 3.5 billion of us, or nearly half of the global population, use e-commerce platforms. China now has the largest e-commerce market in the world.
The COVID-19 pandemic shifted behavior, with many people going digital in a big way. Even before the pandemic, e-commerce was overtaking modern store purchases across Asia. People are also embracing “super-apps” that let you buy many different goods in one place—like a big mall but inside a single app. The US, Japan, the UK, and Germany now line up behind China in e-commerce.
Bollywood produces almost twice as many films as China, the next-largest producer. And way, way more than what Hollywood does each year. Asians might love movies from elsewhere but they are making and checking out more of their local culture, and exporting it to the rest of the world.
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