The impacts of the conflict drove a much greater spike in — short-term spike in inflation. That’s playing itself through. It looks like the European economies are going to avoid a technical recession, but clearly, consumer demand is softening, and I think that’s likely to continue into the rest of the year. And looking at the other markets in EMEA, if you’re a resource seller, you’re doing well. If you’re a resource buyer, you’re under more pressure. Obviously, Turkey, tragic situation with the earthquake, but also the economy has been under pressure already. So the emerging markets there are a full range. And similarly, in Africa, South Africa is important to us. They’ve got a very big problem in terms of energy, which is hampering the economic growth.
So, there’s more pressure in EMEA. The US continues to be strong. We’ve got momentum in the business on the top line, doing well. The situation seems to be moderating without causing a hard landing. As of yet, we expect to see the pressure to continue to moderate, but the economy and the consumption, at least of beverages, continues to be good. Latin America, similarly, there’s been — obviously, there’s some places which continue to have very high inflation and the economic problems like the Argentinas of the world. But Latin America is doing well. And then out to Asia, obviously, the reopening of China is going to be a positive for the business, certainly on a cycle basis. India is flying. ASEAN, we expect come back up as those two large economies do well, and we think that will also do well for Japan.
So we see both a continued acceleration or continued growth in a number of markets, some doing really well, but the general context being a moderation of the inflation. And then the zillion dollar question always comes back to is the process of bringing inflation down going to be hard, soft or perfect landing, and that we will see.
Operator: Our next question comes from Bryan Spillane from Bank of America. Please go ahead. Your line is open.
Bryan Spillane: Thanks, operator. Good morning. Just a question for John. I guess two — just related to cash flow and interest expense. I know you talked about net interest expense being up for the year in ’23. Can you just give us a little bit more detail in terms of — I think consensus is sitting at like $600 million for net interest. So just, if you could give us a little more help in terms of where we should be on net interest expense. And then on free cash flow, you talked about the drivers that knock it down in ’23. Would we expect that, as we kind of go into ’24, ’25, like that should normalize? So is this more kind of contained within this year and then you expect to normalize going forward? Thank you.
John Murphy: Thanks, Bryan. Let me start the second question. The key drivers for ’23, we have on top of underlying — strong underlying performance, we’ll have two significant buckets. One is we are stepping up our capital investments to support the growth agenda in a number of our operations around the world. And so that’s a $400 million increase in ’23. And then we have approximately $700 million related to an uptick in the transition tax and some M&A-related initiatives. So for 2024, we’ll continue to invest in the business as the business needs, especially when it comes to providing capital for our growth plans. The transition tax goes up a couple of hundred million in 2024. That will be the second last year of the transition tax date that ends in 2025.
