The latest Standard Chartered Greater Bay Area Business Confidence Index (GBAI), jointly released by Standard Chartered and the Hong Kong Trade Development Council (HKTDC), indicates that business sentiment across the Greater Bay Area (GBA) remained steady in the fourth quarter of 2025 despite persistent external uncertainties. The 'current performance' index fell to 50.3 from 54.7 in the prior quarter, and the 'expectations' index dropped to 51 from 55.7. However, both indices stayed above the 50 expansionary threshold, suggesting that businesses maintain a broadly positive outlook.
Sub-indices painted a mixed picture. For 'current performance,' new orders, fixed asset investment, and profit fell below 50, attributed to a correction after earlier front-loading and subdued loan growth in Mainland China. Conversely, 'expectations' remained positive, with production/sales, new orders, and profits all in expansionary territory, indicating robust demand likely to persist into early 2026.
Hong Kong's readings significantly outperformed the survey average. The city's 'current performance' sub-index surged 5.7 points to 57.9, and the 'expectations' reading rose 1.8 points to 55.4. This sustained recovery was driven by professional services and retail/wholesale sectors. Wing Chu, Deputy Director of Research at HKTDC, noted that the extension of the US-China trade truce bolstered Hong Kong's business sentiment, allowing it to outperform other GBA cities. He expects this momentum to continue, supported by buoyant business activity and professional services.
The survey also explored GBA businesses' interest in expanding into the Middle East. Over half of respondents (54.8%) expressed interest, with the UAE (53.9%) and Saudi Arabia (53.2%) as top priority markets. Among these firms, nearly 60% were involved in trading/distribution, followed by manufacturing (42.7%) and logistics/storage (28.3%). However, challenges remain: top concerns include lack of understanding of local laws (50.4%), opaque regulatory environment (43.1%), and cultural differences (42%). Notably, 99.2% of respondents considered Hong Kong's professional services crucial for successful Middle East expansion, particularly for navigating regulatory and compliance requirements.
Hunter Chan, Economist, Greater China at Standard Chartered, highlighted that global corporates are diversifying supply chains and exploring new markets, aligning with Hong Kong's 'GoGlobal Task Force' to deepen economic ties with the Middle East. He emphasized that Hong Kong's professional services advantage positions it as a 'super-connector' and springboard for enterprises expanding overseas.
The GBAI, a forward-looking quarterly survey, examines business sentiment and synergistic effects across the GBA, based on over 1,000 responses. It includes five sub-indices covering manufacturing, retail, financial services, professional services, and innovation & technology. The full report is available at Standard Chartered GBA Index Report. For more research, visit HKTDC Research.
