After an extremely pessimistic autumn 2024, the mood of local companies in Asia-Pacific (excluding Greater China) has brightened slightly when it comes to the current business situation. This is the result of a company survey conducted by the German Chambers of Commerce Abroad among German companies, branches and subsidiaries as well as companies with close ties to Germany in the region.
In the survey period from 17 March to 14 April 2025, 705 responses came from the Asia-Pacific region (excluding Greater China) and 196 from the Greater China region.
Here are the main results:
• Business situation slightly better, expectations muted in Asia-Pacific (excluding Greater China)
• Sentiment in Greater China gloomy
• Business situation: optimism, especially in Sri Lanka and the Philippines
• Business expectations: Optimism declines slightly almost everywhere
• Demand and economic policy greatest business risks at almost all locations
• Local economic expectations fall significantly
• Pessimism for the economy at nine out of fourteen locations in the region
• Investment intentions almost constant except in Greater China
• Employment intentions in Asia-Pacific restrained
• Consequences of US trade policy clearly noticeable in the region
• Trade barriers as the challenge in the next 5 years
II. Business situation and expectations
A total of 85 per cent of companies state that their current situation is "good" (38 per cent) or "satisfactory" (47 per cent). This assessment was similar six months ago. At that time, 82 per cent stated that their situation was "good" (35 per cent) or "satisfactory" (47 per cent).
Business situation and expectations in Asia-Pacific (excluding Greater China) Figures in per cent
Current situation assessment
Business expectations for the next 12 months
More cautious expectations for future business in Asia-Pacific (excluding Greater China)
However, companies are less optimistic about their future business than they were in autumn 2024. While 92% of respondents then described their business expectations for the coming months as "better" (51%) or at least "the same" (41%), only 86% currently describe their expectations for their own business as "better" (49%) or "the same" (37%)
Business situation and expectations in Asia-Pacific (excluding Greater China) Balance of "good/better" responses minus "bad/worse" responses)
business situation business expectation
Business is currently improving again. Even if they are nowhere near the level of previous years. Looking at the balance of "good" minus "bad" responses to the current business situation, the survey shows an increase of six points from 17 in autumn 2024 to the current 23 points. This is still slightly below the value from a year ago (25 points) and well below the peak value of 38 points after the pandemic in autumn 2022. Unlike the current situation, business expectations are at a more optimistic, higher level. However, sentiment here continues to fall from a balance of "better" minus "worse" responses of 43 points in autumn 2024 to 35 points now.
Current sentiment in Greater China gloomy
The current business situation in Greater China is rated as "good" (25 per cent) or "satisfactory" (48 per cent) by 73 per cent of companies there However, 27 per cent of companies also state that their current business situation is "poor". Although the balance for the current business situation of "good" minus "poor" responses is currently better than in spring 2024 (minus seven points), it has fallen further from minus one point in autumn 2024 to currently minus two points.
Business expectations for the coming 12 months are also slightly less optimistic among the companies surveyed in Greater China than they were in autumn. Currently, 27 per cent of companies expect business to improve, 57 per cent expect it to remain the same and 16 per cent fear it will deteriorate This means that the balance of "better" minus "worse" responses has fallen from 15 points in autumn 2024 to eleven points at present
Business situation and expectations in Greater China (PR China, Taiwan, Hong Kong)
Balance of "good/better" answers minus "bad/worse" answers)
Business situation: positive sentiment in Sri Lanka and the Philippines
Sri Lanka is currently leading the way in terms of positive situation assessments in the region, with a balance of 54 points In autumn 2024, the balance there was still significantly lower at 29 points. None of the companies there consider the current business situation to be "poor", 54 per cent even rate it as "good" and 46 per cent as "satisfactory".
Companies in the Philippines continue to rate their current situation as good. Even though the balance fell from 55 to 47 points However, this still puts the Philippines in second place among the top optimists in Asia-Pacific, with 58 per cent of companies rating their business situation as "good" and 32 per cent as "satisfactory".
India and New Zealand follow in the list of countries with a predominantly good business situation, both with a balance of 42 points. With a negative balance of minus five points, New Zealand recently experienced a significant downward slip but is now back in the average range at 42 points.
By contrast, business is poor in South Korea, where the balance plummeted from minus three points in autumn to just minus 19 points at present 36 per cent of companies here describe their situation as "poor" and only 17 per cent as "good".
With a balance of minus five, the People's Republic of China follows among the countries in which companies consider the current situation to be rather less rosy. 29 per cent see the current business situation as "poor" and less than a quarter as "good".
In Singapore, companies are also no longer as confident about the current situation, with a balance of four, compared to 12 in autumn 2024. 18 percent of "good" responses are offset by 14 percent of "bad" responses.
Business situation Asia-Pacific Country overview (Balance of "good" answers minus "bad" answers)
Business expectations: Optimism declines slightly almost everywhere
With a balance of 64 points, Sri Lanka clearly stands out among all countries in the Asia-Pacific region in terms of companies' outlook for their future business Two thirds of companies there expect "better" business in the coming months, with only two per cent expecting "bad" business
Like Sri Lanka, companies in India are optimistic about the coming months: at 64 points, the balance of optimists minus pessimists is well above the global average (25 points) and the average in Asia/Pacific (35 points). As far as business expectations are concerned, there is no "bad" feedback here, and almost two thirds, 64 per cent of local companies, see "good" business expectations.
As with the business situation, the Philippines are also among the top optimists when it comes to expectations, with a balance of 62 points Here, too, almost two thirds of the companies state their business expectations as "better" (65 per cent) and only three per cent as "worse".
Business expectations in South Korea and Singapore have deteriorated significantly, with a balance of minus eight and minus seven points respectively. Six months ago, the outlook for companies in both countries was still positive. In Singapore, the majority of responses are in the "satisfactory" category at 63 per cent. However, 22 per cent even expect "poor" business developments, and in South Korea this figure is as high as 30 per cent.
Business expectations Asia-Pacific Country overview (Balance of "better" answers minus "worse" answers)
III. Risks
The top risks in Asia-Pacific excluding Greater China in spring 2025 are almost the same as in autumn 2024: demand 49 per cent cite this as the biggest risk. However, economic policy has now moved into second place as a business risk. 44 per cent cite this, followed by exchange rate risks at 41 per cent. The biggest jump up the risk list is the issue of trade barriers. While only 23% of companies saw this as a business risk in autumn 2024, this figure has now risen to 37%. Companies in the region see infrastructure (12 per cent) and legal certainty (12 per cent) as far less of a risk. And only 16 per cent of local companies are also concerned about energy prices.
Business risks in Asia-Pacific (excluding Greater China) (in per cent, multiple answers possible)
As in the rest of the Asia-Pacific region, demand is also the biggest business risk in China. 71 per cent of companies there cite this. Trade barriers and economic policy follow with 43 per cent of company responses each, an increase of three percentage points.
Demand and economic policy at almost all locations Main risks
Looking at the individual locations in the region, the People's Republic of China stands out particularly in terms of demand risk: 79 per cent of companies there are concerned about demand. However, almost two thirds of companies in other locations such as Australia, Singapore and Hong Kong (64 per cent) also cite demand as the highest business risk. Only in Sri Lanka (26 per cent) and India (36 per cent) are companies relatively less concerned in this regard.
Companies in Hong Kong (67 per cent), Singapore (64 per cent) and Indonesia (63 per cent) in particular cite economic policy as a business risk. Japan is the only location where less than a third of companies see economic policy as a risk (23 per cent).
Exchange rates are a particularly high business risk for companies in Japan (70 per cent), Indonesia (63 per cent) and South Korea (61 per cent). This is in contrast to Hong Kong (11 per cent) and Thailand (12 per cent), where companies consider exchange rates to be a significantly lower risk.
Companies in Indonesia (58 per cent), Singapore (57 per cent) and Hong Kong (53 per cent) in particular see trade barriers as a business risk. New Zealand, with its new free trade agreement with the EU, is a conspicuous exception in this respect. Only eight per cent of companies there cite trade barriers as a business risk.
Business risks in the regions (in per cent, multiple answers possible)
IV. Economic development on site
While expectations for local economic development in Asia-Pacific excluding Greater China were still at a balance of 15 in autumn 2024, this has now plummeted by 25 points to a value of minus ten. Almost a third of companies (32%) expect local economic development to deteriorate, compared to 18% in autumn 2024.
Companies in Greater China are also pessimistic when it comes to local economic development. The balance of "better" answers minus "worse" answers was minus six points there in autumn 2024 and has now fallen again to minus 15. 27% expect "worse" economic development there, compared to five percentage points less in autumn 2024.
Economic expectations ( Balance of "better" answers minus "worse" answers )
Pessimism for the economy at nine out of fourteen locations in the region
Negative sentiment with regard to local economic development prevails in nine out of fourteen AHK locations in the region. In South Korea (minus 64 per cent) and Japan (minus 50 per cent) in particular, there is a clearly negative balance of "better" responses minus "worse" responses. In Korea, more than two thirds (67 per cent) expect a deterioration in local economic development, compared to 52 per cent in Japan. Indonesia, where the balance was still zero in autumn, has now fallen to minus 24. 44 per cent of companies there expect the economy to perform worse.
In contrast, there is optimism in India with a balance of 51 and Sri Lanka with a balance of 39, which corresponds with the positive expectations for the company's own business in these two countries. There are also positive balances in the Philippines (27), New Zealand (twelve) and Malaysia (six). In the Philippines, 39 per cent expect the economy to improve and 49 per cent expect it to remain the same. 65 per cent of companies in Malaysia and New Zealand also expect the same development, while 20 per cent in Malaysia and 23 per cent in New Zealand expect an improvement.
Economic expectations Asia-Pacific Country overview (Balance of "better" answers minus "worse" answers)
V. Investment intentions
Looking at the Asia-Pacific region as a whole, it is clear that local companies want to continue investing, with the exception of Greater China. Although the balance of "higher" responses minus "lower" responses has fallen slightly, it has only decreased by two points compared to autumn 2024 to currently 18. 31% of companies state that they intend to invest more, compared to 32% in autumn 2024. In contrast, the balance of investment intentions in Greater China remains negative at minus 15. While 27% of companies were not planning to invest in Greater China in autumn 2024, this figure is currently 20%.
Investment intentions (balance of "higher" answers minus "lower" answers)
The company responses for future investments show strikingly positive balances not only in India (50), but also in the Philippines (38), Vietnam (33) and Sri Lanka (29). In contrast, the situation in South Korea looks similarly bleak with a negative balance of minus 22 as in the People's Republic of China, where the balance is minus 21.
VI. Employment intentions
In Greater China, the balance of "higher" responses minus "lower" responses remains in negative territory, at minus four. In the rest of Asia-Pacific, the balance has fallen slightly, but is still in positive territory at 27. 37 per cent forecast an increase in employment in their companies in Asia-Pacific (excluding Greater China), while 27 per cent in Greater China are more likely to see a decrease.
Employment intentions (balance of "higher" answers minus "lower" answers)
Asia/Pacific (excluding Greater China) Greater China
Optimists in terms of employment are to be found in India, the Philippines, Malaysia and Vietnam. The positive balance there is 32 points or more. The only negative balances for locations in Asia-Pacific outside Greater China are in South Korea (minus eight) and New Zealand.
Employment intentions Asia-Pacific country overview (balance of "higher" answers minus "lower" answers)
VII. Consequences of US trade policy
The effects of the current US trade policy are also being felt in the Asia-Pacific region. At locations outside Greater China, 61 per cent of companies expect a negative impact on their local business: 21 per cent expect a major negative impact, 40 per cent expect a minor negative impact. 33 per cent of companies expect no impact on their business activities, while six per cent expect positive effects.
The situation is somewhat different in Greater China: A quarter of companies expect a major negative impact, 47 per cent expect a minor negative impact. Less than a quarter expect no impact on their business activities, while five per cent expect positive effects.
What impact do you expect the new US trade policy to have on your company's local business? (in per cent)
Negative statements increased during the survey period
The company survey took place from 17 March to 15 April 2025. On 2 April 2025, Donald Trump announced extensive tariffs on "Liberation Day". The charts compare the companies' responses before and after 2 April.
It is clear that even before the so-called "Liberation Day" on 2 April 2025, companies in both Greater China and the rest of the Asia-Pacific region were already expecting predominantly negative effects from US trade policy. However, "Liberation Day" had a booster effect on companies' negative responses: in Asia-Pacific excluding Greater China by 17 percentage points, in Greater China the value rose by 13 percentage points.
Effects of the new US trade policy in Asia/Pacific (excluding Greater China) (in per cent)
Effects of the new US trade policy in Greater China (in per cent)
All locations feel the effects
Consistently more than 50 per cent of companies at all locations in the region state that US trade policy will have a major or at least a minor negative impact on their own business.
Concerns are particularly high in Singapore: 93 per cent expect a negative impact , of which 36 per cent expect a major negative impact and 57 per cent a minor negative impact. The situation is similar in South Korea, where 89 per cent expect a negative impact, 42 per cent of which expect a minor impact and 47 per cent a major impact
In the search for locations with relative optimists who expect no or even positive effects, the Philippines and India as well as Vietnam, Malaysia and Indonesia stand out at best.
What impact do you expect the new US trade policy to have on your company's local business? (in per cent)
VIII. Trade barriers
Trade barriers dominate the list of the biggest challenges, not only worldwide but also in Asia-Pacific. This topic is particularly relevant in Greater China. 76 per cent see this as the biggest global challenge there.
It is striking that some topics are viewed differently in Greater China than in the rest of the Asia-Pacific region or worldwide. For example, significantly more companies in Greater China see the topic of "fragmentation / de-coupling" (71 per cent) and also the area of "supply chain diversification / de-risking" (35 per cent) as a greater challenge than globally or in the rest of Asia-Pacific.
Conversely, raw materials and energy (11 per cent) and inflation / monetary policy (21 per cent) pose significantly less of a challenge for companies in Greater China than in other locations.
What are the biggest global challenges from your company's perspective in the next five years? (in per cent, multiple answers possible)
Companies in Singapore (89 per cent), India (82 per cent) and the People's Republic of China (81 per cent) in particular see trade barriers as the biggest challenge over the next five years.
Fragmentation and de-coupling are an issue for at least half of the companies in all locations, in Singapore it is even 82 per cent. Only the Philippines with 34 per cent, Sri Lanka with 37 per cent and Thailand with 46 per cent are below this 50 per cent mark.
What are the biggest global challenges from your company's perspective in the next five years? (in per cent, multiple answers possible)
X. Questionnaire
How do you assess the current business situation of your company?
• good / satisfactory / poor
What business development do you expect for your local company over the next twelve months?
• better / constant / worse
How do you see the local economy developing over the next twelve months?
• better / constant / worse
How do you expect your company's spending on local investments to develop over the next twelve months?
• higher / constant / lower / no investment
How do you expect your company's local workforce to develop over the next twelve months?
• Higher / constant / lower
Where do you see the greatest risks to the economic development of your company in the coming twelve months? (multiple answers possible)
• Demand
• Financing
• Labour costs
• Shortage of skilled labour
• Exchange rate
• Energy prices
• Commodity prices
• Legal certainty
• Economic policy framework
• Infrastructure
• Trade barriers / favouring domestic companies
• Disruption s in the supply chain (e.g. logistics, lack of preliminary products)
Do you see any other risks for the economic development of your company?
What impact do you expect the new US trade policy to have on your company's local business?
• a major negative impact
• a minor negative impact
• No effects
• Positive effects
From your company's perspective, what are the biggest global challenges in the next five years? (multiple answers possible)
• Fragmentation of the global economy/decoupling
• Diversification of the supply chain/ DeminusRisking
• Climate change
• Transformation of the economy towards sustainable energy/production
• Raw material shortfall and energy supply security
• Digital transformation, artificial intelligence
• Cybersecurity
• Trade barriers and minus conflicts
o Increase in political influence on supply chains (e.g. through laws, trade barriers)
o Customs duties and countercustoms duties
o Subsidies, discriminatory industrial policy
• Inflation/monetary policy framework
• Migration
• Other (free text)
Methodology
The "AHK Asia-Pacific Business Outlook Spring 2025" is based on a DIHK survey of member companies of the German Chambers of Commerce Abroad, delegations and representative offices (AHKs). In spring 2025, it collects feedback from around 4,600 German companies, branches and subsidiaries worldwide, as well as companies with close ties to Germany. This includes 732 responses from the Asia-Pacific region (excluding Greater China) and 196 from the Greater China region.
The results for the continental regions and the global value are weighted. The basis for the weighting of an individual country is the average gross domestic product (GDP) for the years 2017-2021 in US dollars. Results at country level are shown from a minimum response rate of 20. For Australia, the value in spring 2025 was just below this limit.
The survey was conducted from 17 March to 14 April 2025.
Imprint
Contact person at the DIHK: Dr Gabriele Rose rose.gabriele@dihk.de
German Chamber of Commerce and Industry (DIHK) | Berlin | Brussels
All rights reserved by the publisher. Reproduction - even in part - is only permitted with the express authorisation of the publisher.
Postal address: 11052 Berlin | House address: Breite Straße 29 | Berlin-Mitte Phone: 030 20308-0
