The Standard Chartered Greater Bay Area Business Confidence Index (GBAI) for the fourth quarter of 2025 indicates that business sentiment across the Greater Bay Area (GBA) remained steady, despite ongoing external uncertainties. The index, jointly released by Standard Chartered and the Hong Kong Trade Development Council (HKTDC), showed a moderate quarter-on-quarter retreat following a rebound in the previous quarter. This retreat is attributed to diminishing returns from front-loading activities and a more cautious approach to investment, financing, and capacity utilisation.
The "current performance" index for business activity in Q4 fell to 50.3 from 54.7 in the previous quarter, while the "expectations" index dropped to 51 from 55.7. Despite these declines, both indices remained above the 50 mark, indicating expansionary territory and a broadly positive outlook among GBA businesses. Sub-indices presented a mixed picture: "current performance" sub-indices for "new orders," "fixed asset investment," and "profit" all fell below 50, seen as a correction after earlier front-loading. Conversely, "expectations" sub-indices for "production/sales," "new orders," and "profits" stayed in expansionary territory, suggesting robust demand may persist into early 2026.
Hong Kong's readings stood out, with a "current performance" sub-index of 57.9 (up 5.7 points) and an "expectations" reading of 55.4 (up 1.8 points), significantly above the survey average. Wing Chu, Deputy Director of Research at HKTDC, attributed this to the extension of the US-China trade truce and strong performance in Hong Kong's professional services and retail/wholesale sectors. "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," Chu said.
The survey also explored GBA businesses' interest in expanding into the Middle East, finding that 54.8% of respondents expressed interest, with the UAE (53.9%) and Saudi Arabia (53.2%) as top priority markets. Among those interested, nearly 60% were engaged in trading/distribution, followed by manufacturing (42.7%) and logistics/storage (28.3%). However, businesses identified key challenges: lack of understanding of local laws and regulations (50.4%), opaque regulatory environment (43.1%), and cultural differences (42%). Critically, 99.2% of respondents considered Hong Kong's professional services pivotal to overcoming these challenges.
Hunter Chan, Economist, Greater China at Standard Chartered, noted: "With increasingly complex geopolitical risks, global corporates actively diversify supply chains and explore new markets. The survey found GBA corporates interested in entering the Middle East, aligning with Hong Kong Government's policy focus to set up the 'GoGlobal Task Force.'" The full GBAI report is available at Standard Chartered GBA Business Confidence Index Report and further research at HKTDC Research.
