Category: Economic Development

Organizations are increasingly shifting away from traditional models focused on maximizing financial returns for shareholders and owners toward approaches centered on impact and stewardship. While impact refers to economic, social and environmental outcomes, stewardship is the responsibility of leadership to manage those outcomes sustainably. The role of leadership in driving meaningful, long-term impact has never been more crucial in a rapidly changing world.

In Asia-Pacific, home to over 2.2 billion urban dwellers according to the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP), environmental issues are a growing concern. With six of the world’s 10 most climate-vulnerable countries located in the region, the population faces increasing risks such as air pollution, water scarcity, urban heat islands and biodiversity loss. Rapid urbanization will continue to put a severe strain on infrastructure and resources unless the region embraces sustainable urban planning, technological innovation and social inclusion.

Governance plays a crucial role in building urban resilience, according to UNESCAP. Stronger regional cooperation on climate action, promoting low-carbon transport solutions and investing in climate-resilient infrastructure will be critical for the region’s future.

A Model for Sustainable Governance

Sarawak, Malaysia, one of Borneo’s most biodiverse states, is turning rainforests, festivals and youth summits into models for sustainable governance. Sarawak Tourism Board has spent the last several years building institutional plat forms such as Rainforest World Music Festival (RWMF) and Rainforest Youth Summit (RAYS) to reflect the state’s commitment to environmental conservation and cultural diversity.

Held within the rainforest landscape of Sarawak Cultural Village, RWMF integrates sustainability into its program and operations. For instance, RWMF has consistently diverted over 30% of waste from landfills and aims to plant 10,000 trees by 2027 through the ecoGreen Planet initiative. Meanwhile, RAYS is designed to bring together youth delegates, policymakers, sustainability advocates and community voices to exchange ideas and develop practical responses to environmental and social challenges.

Through these events Sarawak positions itself as a regional case study in how biodiversity protection, cultural continuity and intergenerational leadership can operate within the same system, offering ASEAN a practical example of conservation in practice.

Sustainability in Real Estate

The real estate sector plays a central role in urban planning, shaping how cities grow and respond to climate risks. Megaworld, one of the Philippines’ largest real estate companies and currently the country’s biggest hotel developer and operator, is behind the development of Mactan Expo, a new two-story standalone convention center in Lapu Lapu City, Cebu.

Mactan Expo is designed to meet the requirements of the Philippine Green Building Council, integrated with sustainability features such as energy-efficient lighting and a sewage treatment plant. The convention center also highlights Cebuano art, culture and environmental stewardship. Its strategic proximity to the airport and transport terminals, along with walkable access to hotels, offices, beach resorts and leisure destinations, allows events to be staged more efficiently with less reliance on transportation. From its lobby to its main halls, Mactan Expo incorporates Cebuano cultural motifs and design elements inspired by the island’s natural environment. Together, these features highlight Megaworld’s long-term commitment to environmental stewardship, aligned with the United Nations Sustainable Development Goals.

Ultimately, environmental stewardship relies on collective efforts across sectors, stakeholders and communities to ensure a sustainable future for generations to come.

Japan’s stock market entered 2026 on a strong footing, with the Nikkei hitting record highs on the back of robust corporate earnings, a recovery in private consumption and newly announced government economic measures. Analysts expect the momentum to persist through the year, supported by corporate governance reforms and the country’s largest fiscal package since the Covid-19 pandemic, aimed at boosting domestic demand.

Artificial intelligence (AI)-related sectors and non-manufacturing industries were among the key contributors to GDP growth in 2025. Tourism, for example, demonstrated a strong recovery, boosting the services sector. The economy is expected to maintain steady growth in 2026, with GDP projected to expand moderately.

Strengthening AI Capabilities

Japan is moving to strengthen its AI capabilities and has committed to a significant increase in AI investment over the coming years. As the technology evolves rapidly, businesses are also stepping up spending on cybersecurity to manage the growing risks that come with it.

InfoSec Advisory, an IT security consulting firm, helps organizations protect information assets, manage cyber risks and comply with security standards and regulations. What makes today’s threat landscape particularly alarming, the firm says, is not just the scale of attacks, but who can now execute them. The emergence of generative AI and Ransomware-as-a-Service platforms has fundamentally altered the accessibility of cybercrime.

InfoSec Advisory aims to strengthen supply chain resilience by promoting unified security frameworks across interconnected manufacturing economies. The company believes Japan is uniquely positioned to lead regional standard-setting in supply chain security, with its deep understanding of manufacturing quality management and international standards.

Meanwhile, global consulting firm SYNTHESIS is seeking to reinvent the consulting industry through a strategic presence in key financial centers across Asia and North America. The firm differentiates itself from traditional consultancies through its structure, having been built from the ground up for the AI era. It replaces hierarchical teams with a more agile model and uses AI tools to deliver tangible results in weeks.

Over the next 12 to 24 months, SYNTHESIS plans to embed AI in every element of consulting, building a fundamentally new consulting model. The firm also aims to attract top global talent and develop a new generation of consultants capable of creating value in an AI-driven economy.

Building Strong Global Brands

Japan’s legacy companies remain a cornerstone of the country’s economy. Many have also successfully extended their influence beyond domestic borders, building strong global brands and achieving dominance in certain sectors. Kikkoman, which traces its soy sauce production back to the 17th century, has become a global growth engine, with international sales accounting for almost 75% of its total revenue. The United States is its largest market, and the company plans to open a third production facility there this year.

Looking ahead, Kikkoman sees Asia as its next major growth market, supported by rising incomes and increasing demand for high-quality products.

Enabling Cross-Border Investment

The real estate sector remained robust in 2025, driven by foreign investment. Family offices and institutional investors are drawn to Japan for its stable, high-quality real estate market, transparent legal system, strongly enforced property rights and equal ownership rights for foreign buyers.

Post Lintel, a fully integrated real estate solutions company, facilitates cross-border transactions for global investors, covering everything from sourcing and acquisition to legal structuring, asset management and building maintenance. The company’s international team combines deep local expertise with global fluency across Asia and beyond, enabling seamless operation across languages, cultures and regulatory frameworks. Post Lintel offers foreign investors not just access to Japan, but clarity, continuity and peace of mind in one of the world’s most complex real estate environments.

Looking ahead, Japan’s economic trajectory reflects stability, select growth opportunities and enduring appeal for global investors.

Indonesia’s economy grew 5.04% year-on-year in the third quarter of 2025, supported mainly by the manufacturing and agriculture sectors, along with a rebound in exports. The government has introduced several stimulus packages to support households and create jobs, including food assistance, internship programs, housing initiatives, tax breaks for small businesses and infrastructure projects intended to bolster economic activity through 2026. 

To further drive national economic growth, the Indonesia Investment Authority is prioritizing investment in high-growth sectors including digital infrastructure, healthcare and renewable energy. At the same time, Indonesia’s new sovereign wealth fund, Danantara, plans to deploy US$10 billion within three months starting October 2025. Over the next two years, it will focus on investments in energy and food security, renewable energy, financial services, healthcare, real estate and digital infrastructure.

Advancing Digital Economy and Infrastructure

Indonesia’s expanding digital economy and rapid adoption of AI are attracting significant investment from global tech giants. Amazon Web Services (AWS), for example, has committed billions to developing and scaling the country’s digital infrastructure. In August, AWS hosted its AWS Summit Jakarta, bringing together industry leaders and business executives to network and exchange insights. During the event, AWS reaffirmed its commitment to delivering the technology, expertise and partnerships needed to support businesses and advance Indonesia’s digital economy. 

Meanwhile, PT Telkom Indonesia (Persero) Tbk (Telkom) is executing two landmark moves by developing a hyperscale data center in Batam and spinning off part of its wholesale fiber connectivity business. These initiatives reflect Telkom’s strategic intent to enable Indonesia’s AI and digital economy ambitions, optimize assets and governance for long-term competitiveness and position itself as a regional digital infrastructure champion.

Moving Toward Golden Indonesia 2045

As part of a strategic pivot, the government is expanding and reimagining its global partnerships, highlighted by its landmark Comprehensive Economic Parnership Agreement with the EU and its renewed focus on the Middle East. It is also continuing to deepen regional cooperation through ASEAN. 

These efforts align with the Golden Indonesia 2045 vision—a national strategy to transform the country into a prosperous and developed nation with meaningful global influence. The strategy is built on four pillars: sustainable growth, social equity, environmental stewardship and geopolitical influence.

Driving this vision, businesses—particularly in high-value sectors—will be the main engines of growth, supporting bold targets of 7% to 8% annual GDP expansion. To enable this, the government is implementing business-friendly policies that attract foreign investment and promote local enterprises and entrepreneurship. 

Sustainability remains central to Indonesia’s economic agenda. The country has committed to achieving net zero emissions by 2060 and is heavily investing in an integrated electric vehicle ecosystem, leveraging its position as the world’s largest nickel producer. It also aims to increase the share of renewable energy in its electricity mix to 41% by 2040, up from 15% in 2024. The Asian Development Bank recently approved a US$470 million results-based loan to help the country accelerate the rollout of utility-scale solar and wind projects and upgrade grid infrastructure across major systems.

With these efforts in place, Indonesia is well positioned to achieve its goal of building a sustainable and globally competitive future.

The Philippines remains one of ASEAN’s fastest-growing economies, achieving 5.5% GDP growth in the second quarter of 2025, driven by strong domestic demand. Key sectors—including agriculture, industry and services—reported year-on-year growth, contributing to the country’s overall economic performance. Government spending rose 8.7%, with increased investment in education, healthcare, public services and social protection.

The government is accelerating public-private partnerships to at tract greater private sector investment in infrastructure. As of June 2025, 207 flagship projects worth approximately US$176.7 billion have been identified under the “Build Better More” program, spanning key sectors such as education, energy, healthcare, agriculture and digital connectivity. Meanwhile, the Department of Science and Technology plans to invest approximately US$44 million in AI initiatives by 2028 to strengthen the country’s competitiveness and support a sustainable, tech-driven economy.

Resilience in Real Estate

The real estate industry demonstrated resilience in the first half of 2025 despite global market volatility. The office segment continues to grow, driven by increased demand from business process outsourcing (BPO) firms expanding in Metro Manila. In the residential segment, the luxury market remains robust, supported by strong investor interest in high-end developments both within Metro Manila and in key regional locations.

Laurean Residences in Makati City, unveiled recently by Ayala Land Premier, aims to attract homeowners seeking urban living that combines timeless elegance and modern comfort. Its world-class amenities, thoughtfully designed spaces and proximity to major business districts and key lifestyle hubs come together to set a new benchmark for elevated living. Laurean Residences continues Ayala Land Premier’s tradition of creating enduring communities that embody modern luxury in the Philippines.

Meanwhile, the hospitality sector is regaining strength, buoyed by the rapidly growing tourism industry. To capture rising tourist arrivals, hotel developer and operator Megaworld is expanding its portfolio across key destinations. Through its partnership with Accor, Megaworld aims to strengthen its tourism trust by leveraging Accor’s international brand prestige, enhancing the appeal of local townships and elevating the Philippines as a premier tourist destination. Megaworld plans to expand its hospitality portfolio to 9,000 room keys by 2030, solidifying its standing as the Philippines’ largest hotel developer and operator.

Sustainable and Inclusive Growth

With the economy projected to sustain its growth momentum in the second half of the year, conglomerates such as SM Investments Corporation (SM Investments) and International Container Terminal Services, Inc. (ICTSI) remain committed to investing in inclusive and sustainable growth.

SM Investments aims to expand in key areas, reaffirming its commitment to renewable energy as a long-term growth driver. This commitment includes initiatives that support national energy goals—from delivering 300 megawatts of clean, renewable baseload power from its Tiwi and Mak-Ban geothermal steam fields, to pioneering the country’s first megawatt-scale floating solar facility in Cebu. Beyond energy, SM Investments gives back to the community, extending its impact in healthcare, education and food security.

Similarly, ICTSI views its role as more than just moving cargo, integrating social responsibility into its business model. The ICTSI Foundation, the company’s social development arm, introduces impactful community initiatives globally, with the Philippines serving as its launchpad. Programs piloted locally shape community development efforts across ICTSI’s international network, where its advocacy for youth, education, sports, sustainability and resilience is reflected and adapted to the needs of diverse host economies.

Looking ahead, the Philippines is projected to sustain strong growth of 5.5% to 6.5% in 2025, driven by efforts to promote inclusive development and expand economic opportunities across sectors.

The Malaysian economy remained resilient in the second quarter of 2025, recording 4.4% growth driven by strong domestic demand. Private and public investments expanded on the back of new and ongoing initiatives, including digital and construction projects. The services, manufacturing and construction sectors also posted solid performances.

In July 2025, the government unveiled the 13th Malaysia Plan, an economic roadmap for 2026 to 2030. The five-year blueprint outlines a strategic path toward building a resilient, inclusive and sustainable economy, with a projected GDP growth of 4.5% to 5.5% annually. Backed by a total investment commitment of RM611 billion (US$145 billion), the plan targets the development of high-growth, high-value industries, with a focus on advancing key sectors such as digital, renewable energy and semiconductors. It also aims to increase Malaysia’s exports of electronic and electrical products to RM1 trillion (US$238 billion) by 2030, reinforcing the country’s push for “Made by Malaysia” products and services while creating new avenues for growth amid global economic headwinds.

Meanwhile, AI remains a critical enabler for Malaysia’s future. Malaysia Digital Economy Corporation (MDEC) is leading the nation’s ambition to become an “AI Nation” by integrating AI across the economy, government and society. MDEC envisions AI as the foundation for smarter public services, predictive policymaking, and ethical, people-first applications. Supporting this vision is the development of a thriving ecosystem encompassing research, talent development and industry adoption. This core strategy aims to transform Malaysia into a hub for AI innovation and investment in Southeast Asia.

Sustainable, Future-Ready Cities

The Johor-Singapore Special Economic Zone (JS-SEZ) is well-positioned to spur economic growth, create skilled jobs and strengthen regional competitiveness.

The JS-SEZ builds on the foundation of Iskandar Malaysia, the country’s first economic corridor established in 2006. Iskandar Investment Berhad (IIB), the investment holding arm behind Iskandar Malaysia, is committed to creating an inclusive and sustainable metropolis at Iskandar Puteri, a flagship zone within the economic corridor. IIB is developing Iskandar Puteri into one of Malaysia’s most future-ready townships, a smart city featuring a net zero carbon central business district (CBD) and advanced tech hubs. A 2,270-acre area of Medini has been rebranded as Medini Innopolis, a planned smart city and CBD for 65,000 residents by 2030.

As sustainable urban development becomes more crucial than ever, property developers like Eastern & Oriental Bhd (E&O) integrate ESG principles into their development philosophy. E&O’s developments—Andaman Island in Penang and Conlay by E&O in Kuala Lumpur—incorporate practical elements such as ecological buffers, rainwater harvesting and renewable energy systems, lowering operating costs for residents and attracting ecominded buyers. By prioritizing enduring value, rigorous design standards and environmental responsibility, E&O aims to create communities built to last for generations.

Energy Transition Journey

As ASEAN Chair this year, Malaysia is uniquely positioned to unite member states in advancing the region’s energy security and transition goals. In line with this leadership role, PETRONAS is serving as a catalyst for regional collaboration, bridging policy with projects and aligning national ambitions with shared regional objectives.

PETRONAS is approaching the energy transition journey not just as an operator of assets, but as a partner in building an integrated, future-ready energy ecosystem. At the recent Energy Asia 2025, 14 MoUs were signed, covering upstream partnerships, LNG supply and other initiatives, highlighting that a successful energy transition hinges on strategic alignment of capital, innovation and execution.

As Malaysia charts its path toward developed nation status by 2030, its commitment to resilience, innovation and inclusive growth remains clear. The nation continues to strive for excellence, shaping a future that is competitive and sustainable.

As Singapore marks its diamond jubilee this year, the city-state stands at a pivotal juncture—reflecting on a remarkable nation-building journey while charting a course forward amid prevailing global uncertainty.

Singapore’s economy continued to grow in the second quarter of 2025, expanding 4.4% year-on-year despite persistent external challenges. This better-than-expected performance, following 4.1% growth in the previous quarter, was driven primarily by the wholesale trade, manufacturing, finance and insurance, and transportation and storage sectors.

Taking into account the positive performance of the first half of the year, the Ministry of Trade and Industry has upgraded Singapore’s GDP for the year to 1.5% to 2.5%.

Empowering a Future Workforce

As Singapore seeks to maintain its competitive edge, human capital remains its strategic advantage. With AI and advanced technology reshaping the workforce, the nation is investing heavily in job transformation and creation as part of its economic strategy, ensuring that its workforce is engaged in lifelong learning and upskilling. Businesses are encouraged to adopt a skills-first approach to hiring and development, with the ability to reskill, redeploy and redesign roles quickly.

Workforce Singapore (WSG) plays a leading role in helping employers plan and execute their job transformation strategy. Companies can tap into WSG’s job redesign initiatives and reskilling programs to redesign roles and processes, expand their talent pool and reskill their workers to enable more effective integration of both talent and technology. Initiatives such as the Career Conversion Programmes support firms in reskilling employees for evolving job scopes. Funding and advisory services further provide companies with a comprehensive pathway to workforce transformation. This structured approach ensures a future-ready workforce.

A Vibrant Tech Hub  

Singapore has established itself as a strong tech hub, attracting both startups and multinational corporations that are seeking to leverage the city-state’s thriving ecosystem of innovation and access to regional markets.

KDDI Asia Pacific (KDDI APAC), the regional arm of Japan’s KDDI Corporation, is one such multinational that has set up its headquarters in Singapore. One of Japan’s largest telecommunications companies, KDDI APAC delivers integrated cloud, cybersecurity and managed IT services.

The Singapore office plays a central role in KDDI’s ability to deliver its solutions at scale across the region. Singapore, serving as its technological and economic engine, presents KDDI APAC with a pivotal opportunity to be a cornerstone not only for the region but also for its entire global strategy, including Japan.

Recognized as a Global Financial Center

A global financial center, Singapore serves as a key node for Southeast Asia and beyond, supported by a robust regulatory framework that balances innovation with risk management. In 2024, the financial services sector accounted for about 14% of Singapore’s GDP. The sector grew by 6.8%, more than double the growth rate of the preceding year. Singapore’s assets under management surpassed S$6 trillion (US$4.675 trillion) in 2024, a significant milestone driven by strong performances in private equity, venture capital, hedge funds, real estate and real estate investment trusts.

Singapore has strengthened its position as a leading wealth management hub, recognized for its strong governance, pro-business policies and political stability. It continues to attract high net worth (HNW) individuals and families seeking a range of services—from investment management and succession planning to risk and insurance planning, family office setup and private banking.  

Standard Chartered Global Private Bank has seen growing demand in the region for holistic legacy planning. The bank works with ultra-high net worth individuals and families beyond formal planning sessions, offering ongoing support that extends outside traditional wealth and legacy discussions.

AIA Singapore is also helping wealthy families and individuals navigate complex legacy planning through its integrated ‘Wealthbeing by AIA’ proposition. In 2024, AIA Singapore launched AIA International Wealth (IW) and AIA Wealth Centre, two major initiatives under its broader ‘Wealthbeing by AIA’ proposition. These pillars are part of a bold, multi-million-dollar strategy to redefine legacy planning for Asia’s affluent families and elevate AIA’s standing as the region’s insurer of choice.

Meanwhile, Royal Bank of Canada (RBC), which has operated out of Singapore for 50 years, is building deeper capabilities to help clients in Asia navigate an increasingly complex global landscape. The bank’s Asia platform is anchored by two core businesses: capital markets and wealth management. The bank’s decision to base these operations in Singapore reflects the country’s strong regulatory environment, skilled workforce and connectivity to the rest of the region. RBC is working to deliver cohesive solutions, particularly for HNW clients whose needs span jurisdictions and asset classes.

Demand in Premium Real Estate

Singapore’s real estate market continues to attract strong demand from HNW buyers, driving a steady pipeline of luxury and ultra-luxury developments. These investors seek homes with prestigious addresses, spacious layouts and premium designer finishes—whether for investment or as trophy residences.

UOL Group Limited’s (UOL) UPPERHOUSE at Orchard Boulevard achieved a 54% take-up rate on launch day. The 99-year leasehold development, a joint venture with Singapore Land Group, offers 301 one- to four-bedroom units in Singapore’s prime District 10. 

UPPERHOUSE at Orchard Boulevard reflects UOL’s broader strategy to invest in and elevate the Orchard Road precinct. The company has a long-established presence in the area, and recent developments signal its commitment to enhancing the area’s appeal as both a lifestyle and residential destination.

Extending the luxury experience into the hospitality sector is Raffles Sentosa Singapore, the city-state’s first all-villa resort, developed and owned by Royal Group. Located just 10 minutes from the central business district, the resort features 62 private villas—each with its own pool and dedicated Raffles butler—offering a new benchmark in exclusivity and service.

Beyond SG60

As Singapore charts its path forward, it must navigate an increasingly complex and competitive global landscape. To remain resilient and relevant, a renewed economic roadmap is essential.

Through the Economic Strategy Review, the government is re-examining national priorities across five critical areas: competitiveness, technology, entrepreneurship, human capital and economic restructuring. The new roadmap aims to position Singapore for sustainable growth and build a future-ready economy.

Thailand is positioning itself for the next wave of economic growth by harnessing opportunities in innovative, high-potential sectors. While manufacturing remains a cornerstone of the economy, the country is increasingly shifting its focus toward areas such as data centers, artificial intelligence, electric vehicles, precision agriculture and food technology. This strategic pivot is vital to enhancing Thailand’s global competitiveness amid evolving global dynamics.

The Thai economy is projected to expand by 2.3% in 2025, with export growth supporting manufacturing and related service sectors in the first half of the year. Thailand continues to draw strong foreign investment, reflecting investor confidence in its robust infrastructure, integrated supply chains, skilled workforce, regional connectivity and pro-business policies. In the first half of 2025, foreign investment reached approximately 111.5 billion baht (US$3.5 billion), a 30% increase compared to the same period in 2024. Of that amount, 56% was directed to the Eastern Economic Corridor (EEC). These investments spanned a range of sectors, including retail trade, R&D services for engineering plastics, data center services, digital platform development and contract manufacturing.

Shift to a Low-Carbon Future

A central part of Thailand’s industrial reform lies in its push toward a green and circular economy. The country is committed to transitioning toward a low-carbon future, aiming to achieve carbon neutrality by 2050 and net zero emissions by 2065.

B.GRIMM, one of Thailand’s largest private energy producers, plays a key role in the nation’s energy transition and pursuit of net zero goal. More than a business, B.GRIMM has contributed to Thailand’s technological, scientific, cultural and social advancement. At the hear t of B.GRIMM’s operations is its vision of “Empowering the World Compassionately,” reflecting an ethos that business can thrive in harmony with nature and community. This philosophy underpins the company’s GreenLeap – Global and Green strategy which drives sustainable growth guided by four core values: positivity, partnership, professionalism and pioneering spirit.

Another leading Thai conglomerate, Siam Cement Group (SCG), is also contributing to a low-carbon future through its innovations. In 2023, SCG introduced Thailand’s first certified low-carbon cement. Together with coordinated policies, the company believes that its broader adoption can accelerate decarbonization in construction and unlock socio-economic value, not just in Thailand but also in developing countries. SCG also invests in R&D to develop other solutions such as green polymers and recyclable packaging that help reduce environmental impact across industries.

Real Estate Recovery

Meanwhile, the real estate sector, one of the key drivers of the Thai economy, is showing signs of recovery. Investments in the EEC are creating spillover effects, driving residential demand alongside industrial growth. Luxury developments and branded residences in Bangkok and beyond continue to attract interest from both local and international buyers.

SC Asset’s latest development, SONLE Residences, located on a rare freehold plot in Bangkok’s Ratchadaphisek area, reflects the demand in the ultra-luxury market. Comprising five exclusive homes, SONLE Residences is a manifestation of SC Asset’s long-term vision. These homes are designed with intentionality, sustainability and craftsmanship, and are meant to serve as lasting legacies for their owners. In a market of ten marked with uncertainty, SONLE Residences embodies prudent assurance, offering clarity, permanence and a home that reflects thoughtful living beyond wealth.

With market watchers optimistic about the real estate outlook, the sector is expected to support economic growth as Thailand continues to pursue opportunities amid global uncertainty and domestic challenges. By embracing innovation and investing in future-ready industries, the country is charting a path toward long-term growth.

Japan welcomed the new year on a positive note, with its economy having shown signs of resilience in 2024, fueled by rising wages and growing private consumption. In the third quarter of 2024, GDP grew at an annualized pace of 1.2%, surpassing initial estimates. The government has approved a stimulus package worth 39 trillion yen (US$246 billion) to help lower-income households cope with rising costs and inflation. Part of this package will also be set aside to boost the AI and semiconductor industries through multi-year support programs.

Given these developments, analysts expect a bright outlook for fiscal 2025, coupled with improving business sentiment. The financial sector is set to be a key driver of growth, and strong corporate earnings are expected to propel stocks to record highs. Meanwhile, the real estate market is poised for steady growth as foreign investors, mainly from the Asia-Pacific region, snap up properties from logistics facilities and offices to high-priced condominium units in Tokyo and beyond.

The upcoming World Expo 2025, set to take place in Osaka from April to October, will provide Japan with the platform to showcase its technological and cultural strengths. As one of the largest gatherings of countries and businesses, the Osaka Expo has the potential to boost the economic importance of the Kansai region and create new opportunities for investment in Japan.

From Local to Global Success

Family-owned businesses are the foundation of the Japanese economy, making up more than 90% of all companies. Among them is Kikkoman, which has been doing business in one form or another for over 350 years. Under the visionary leadership of Honorary CEO and Chairman of the Board, Yuzaburo Mogi, Kikkoman has evolved into a global success story and become the focus of business school case studies.

From his many decades in management, Mogi has learned to focus on attracting and retaining the best possible talent to cope with upcoming changes in business and the economy. “Companies are realizing that in order to stay globally competitive, they need employees who have useful skills and good ideas, regardless of their age,” he says.

With nine production plants serving global markets, Kikkoman is set for further expansion in Europe and Asia, as Mogi notes, “there’s plenty of room for growth, regardless of economic ups and downs.”

Japanese Startups Making a Difference

The startup and innovation ecosystem in Japan is growing with support from the government, including funding and regulatory reforms. Two medical startups in Tokyo are commercializing their innovations to improve the health of people everywhere.

AI Medical Service Inc. has released an AI-based endoscopic diagnostic support device that can help doctors in diagnosing gastric cancer. Called gastro AI model-G, the device views gastroscopy imagery in real time and highlights potential areas of concern. The system has been approved by regulators in Japan, Brazil and Singapore, and the company has raised some 14.5 billion yen (US$93.4 million) in funding from venture capital firms and government subsidies.

Meanwhile, clinicians in Japan are now hoping that SONIRE Therapeutics Inc.’s high intensity focused ultrasound (HIFU) therapy will become a standard treatment for pancreatic cancer. In conventional radiotherapy, radiation damages both cancer cells and the surrounding healthy cells that it passes through. In contrast, HIFU waves can be focused on a small region inside the body and do not damage healthy cells.

Such breakthroughs and innovations, made possible through the collaboration between industry, academia and government, will remain a driving force behind economic growth.

Indonesia continues to demonstrate economic resilience despite global challenges, registering a 4.95% GDP growth year-on-year in the third quarter of 2024. The manufacturing and construction sectors were among the key drivers of this growth. As the largest economy in Southeast Asia, Indonesia is an attractive destination for investors, thanks to its political stability, favorable government policies, an abundance of natural resources and a large workforce. The country continues to attract domestic and foreign investment in diverse sectors, from construction and manufacturing to telecommunications and transportation.

Between January and September 2024, Indonesia attracted nearly US$81 billion in investment, mostly from foreign investors. The nation’s robust recovery in tourism is also boosting investor confidence. Indonesia attracted 10.37 million international tourists in the first nine months of 2024, marking a 20.28% increase compared to the same period in 2023. This positive trajectory in tourism has contributed to an increase in hotel investment. In June 2024, the Pan Pacific Hotels Group unveiled Pan Pacific Jakarta in Central Thamrin. The 158-room property reinforces the hotel’s role as a high-profile destination for both business and leisure travelers. It is the second of three properties that the hospitality group plans to open in Jakarta.

Startup Ecosystem Remains Vibrant

Meanwhile, Indonesia’s startup ecosystem remains vibrant, despite funding challenges due to global economic headwinds. In the first half of 2024, fintech, insurtech and enterprise applications emerged as the top sectors to secure funding, highlighting key areas of strategic growth within the industry.

Alpha JWC Ventures (Alpha JWC) remains one of the top venture capital firms in Southeast Asia, playing a key role in supporting some of the region’s most dynamic entrepreneurs in 2024. Locally, Alpha JWC is helping Indonesia strengthen its AI capabilities in a competitive global economy that is increasingly driven by technology. In August 2024, the firm officially launched the Artificial Intelligence Institute for Progress in collaboration with nonprofit organization Pijar Foundation, bringing industry players together to advance AI adoption in Indonesia.

Net Zero Commitment

Indonesia has made steady progress in energy transition as part of its commitment to achieve a net zero economy by 2060 or sooner. Over the span of almost a decade, the country’s new and renewable energy mix grew from around 5.35% in 2014 to 13.1% by the end of 2023.

At COP29, Indonesia reaffirmed its commitment to the Paris Agreement, unveiling plans to build 75GW of renewable power in the country in the next 15 years. The renewable projects will include solar, hydro, geothermal and nuclear power.

Pertamina, a state-owned energy company, is at the forefront of the country’s transition to a low-carbon future. The company is actively developing carbon capture and storage (CCS) and carbon capture utilization and storage (CCUS) technologies to boost oil and gas production while reducing greenhouse gas emissions.

In the downstream business, Pertamina continues to develop biofuels as part of its commitment to energy transition efforts. Its partnership with Toyota during an international auto show earlier this year showcased the potential of bioethanol as a sustainable transportation fuel.

Astra Group, one of Indonesia’s largest public companies, is also playing a part in Indonesia’s climate goals. The company is exploring new technological innovations and sustainable practices that could further enhance its environmental and social impact. One of the group’s flagship initiatives is its investment in electric vehicle infrastructure as part of its Future Mobility plan. It is also  expanding its Future of Mines initiative to transition away from coal dependence by exploring non-coal mineral mining. 

Indonesia’s pro-business climate is set to continue under the country’s new leadership. A new investment institution, Danantara, is designed to optimize the management of state assets outside the national budget and is projected to accelerate economic growth in the next five years. As Indonesia approaches its 80th year of independence, the nation is poised to embark on the next chapter with a clear vision and steadfast commitment to sustainable economic growth.