– Over half of respondents eyeing business expansion in the Middle East
Standard Chartered and the Hong Kong Trade Development Council (HKTDC) have jointly released the latest Standard Chartered Greater Bay Area Business Confidence Index (GBAI), which revealed that the business sentiment for most companies in the Greater Bay Area (GBA) remained steady amid persistent external uncertainties in Q4-2025. The GBA Index is released quarterly in January, April, July, and October each year.
Following a rebound in the previous quarter, the GBAI indices showed a moderate quarter-on-quarter retreat in the fourth quarter of 2025. This has been seen as the result of diminishing returns from front-loading activities and from a more cautious approach to investment, financing, and capacity utilisation amid ongoing external uncertainties.
The “current performance” index for business activity in Q4 retreated to 50.3 from 54.7 in the previous quarter, while the “expectations” index dropped to 51 from 55.7. Despite the drop, both indices remained in expansionary territory, indicating that GBA businesses still maintained a broadly positive outlook.
Turning to the sub-indices, a mixed picture emerged for both “current performance” and “expectations” for the quarter overall. More specifically, with regard to “current performance”, the “new orders”, “fixed asset investment” and “profit” sub-indices all fell below the 50 watershed level. This, however, was seen as a correction following the end of the front-loading process in earlier quarters. Subdued growth in loans and fixed-asset investment in the Chinese Mainland also contributed to this slight downward trend.
On the contrary, the “expectations” remained relatively positive, with sub-indices for “production/sales”, “new orders” and “profits” all staying in expansionary territory in the fourth quarter last year. Taken together, these upbeat outcomes suggest a strong likelihood that robust demand will persist through the first quarter of 2026 and beyond.
In terms of individual GBA city evaluations, Hong Kong’s readings were well above the survey average. This confirmed that the city’s economic rebound remained on course at year-end, with the “current performance” sub-index up 5.7 points to 57.9 and the “expectations” reading up 1.8 points to 55.4. Overall, this sustained recovery in growth momentum was attributed to the city’s “professional services” and “retail/wholesale” sectors.
Wing Chu, Deputy Director of Research, HKTDC, said: “Following the extension of the trade truce between the US and China, business sentiment in Hong Kong continued to improve, allowing the city to outperform its peer cities across the GBA. This strength stands in contrast to the broader moderation seen in the overall GBA indices amid persistent external uncertainties. This momentum in Hong Kong’s recovery is expected to remain intact, supported by buoyant business activity and the professional services sector’s solid performance– key factors that underscore the city’s recovery trajectory. The HKTDC will continue to proactively support GBA enterprises in leveraging Hong Kong’s professional services to ‘go global’ and capitalise on opportunities in emerging markets, including those in the Middle East.”
In order to get a greater understanding of the wider aspirations of GBA businesses, the survey also examined their interest in the expansion into the Middle East. Encouragingly, over half of respondents (54.8%) expressed interest in expanding into the Middle East, with the UAE (53.9%) and Saudi Arabia (53.2%) selected as the top two priority markets.
Digging deeper into these findings, of the companies that have already started or are interested in expanding into the Middle East, nearly 60% were engaged in trading/ distribution activity. This was followed by manufacturing (42.7%) and logistics/ storage (28.3%).
Despite widespread optimism about emerging opportunities in the Middle East, many GBA businesses were also aware they faced several challenges in ensuring success. Overall, the top three concerns here were: “lack of understanding of local laws and regulations” (50.4%), “opaque local regulatory environment and restrictions on foreign investment” (43.1%) and “cultural and business differences” (42%).
Crucially, to help manage such challenges, 99.2% of respondents saw Hong Kong’s world-class services as pivotal to the success of their Middle East expansion plans. Particular emphasis was placed on the decisive contribution of the city’s professional services sector, especially in successfully navigating local regulatory and compliance requirements.
Hunter Chan, Economist, Greater China, Standard Chartered, said: “With increasingly complex geopolitical risks, global corporates not only actively diversify their supply chains but also explore new markets in recent years, thereby giving rise to numerous emerging trade corridors. The thematic survey found that the GBA corporates are interested in entering the Middle East, which aligns with Hong Kong Government’s policy focus to set up the ‘GoGlobal Task Force’ to leverage Hong Kong’s advantages as a ‘go global’ platform, and deepen economic ties with the Middle East. The survey also found that almost all respondents indicate that Hong Kong services are needed to help in expansion into the Middle East to address the challenges posed by local regulations and cultural differences. With its advantage in professional services, Hong Kong can further leverage its unique position as a ‘super-connector’, becoming a springboard for enterprises to develop overseas markets.”
About the GBAI
The Standard Chartered Greater Bay Area Business Confidence Index (GBAI), jointly presented by Standard Chartered and Hong Kong Trade Development Council, is the first forward-looking quarterly survey in the market that examines business sentiment and synergistic effects in the Guangdong-Hong Kong-Macao Greater Bay Area (“Greater Bay Area” or “GBA”). The index is computed from the analysis of more than 1,000 responses from GBA companies regarding their overall operations, business environment, and expansion plans. The index includes five sub-indices that indicate business confidence for each industry, including manufacturing & trading, retail & wholesale, financial services, professional services, and innovation & technology. It enables investors and businesses to better understand the current business climate, gauge future performance and formulate their market strategies in the Greater Bay Area.
Related materials
Standard Chartered GBA Business Confidence Index Report:
https://www.sc.com/hk/gba/gba-index-report/
HKTDC Research: https://research.hktdc.com/en/article/MjIzMTk3MzQwOA
Media enquiries
Standard Chartered Bank (Hong Kong) Limited, Corporate Affairs Department
Flora Chiu, Tel: +852 3843 2285, Email: flora.chiu@sc.com
HKTDC Communications & Public Affairs Department:
Katy Wong, Tel: +852 2584 4524, Email: katy.ky.wong@hktdc.org
Clayton Lauw, Tel: +852 2584 4472, Email: clayton.y.lauw@hktdc.org
About Standard Chartered
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About HKTDC
The Hong Kong Trade Development Council (HKTDC) is a statutory body established in 1966 to promote, assist and develop Hong Kong’s trade. With over 50 offices globally, including 13 in Mainland China, the HKTDC promotes Hong Kong as a two-way global investment and business hub. The HKTDC organises international exhibitions, conferences and business missions to create business opportunities for companies, particularly small and medium-sized enterprises (SMEs), in the mainland and international markets. The HKTDC also provides up-to-date market insights and product information via research reports and digital news channels. For more information, please visit: www.hktdc.com/aboutus.
Findings highlight sustained growth momentum
