Key Events In Asia 2025 To Watch

Economic

Summary:

China’s ongoing struggles, US trade policy, and geopolitical tensions – Asia continues to face various challenges in 2025. There are also some key events investors should monitor.

Trump 2.0 (January)

The return of Donald Trump to the White House is one of the key events globally watched in 2025. The “Made in USA” policies and tariffs are expected to pressure global growth, particularly for Asia’s export-driven economies with trade surpluses with the US. Countries with sizable domestic markets like India and Indonesia are more insulated, while China faces significant challenges from proposed 60% tariffs, potentially bearing the brunt of these measures. However, Trump invited Chinese President Xi Jinping to his inauguration on January 20, and both have been in contact since the US election. It remains open, though, if Xi will attend.

China National People’s Congress (March)

Following a turbulent year in 2024, China is expected to stabilise its economy through targeted stimulus and continued investment in advanced technologies like AI and renewable energy. The first stimulus of the year came on January 8, when Bejing announced the expansion of the national trade-in program to boost sluggish consumer spending. The government said it will subsidise up to 20% of sale prices on goods in 12 categories, including digital tools such as smartphones or household equipment like dishwashers.

The annual Two Sessions in March will be pivotal for policy announcements, particularly around economic restructuring and green initiatives. The premier will unveil the country’s GDP growth target. Analysts expect China to stick to the goal of “about 5%”.

Sri Lanka’s 2025 Budget (February)

Sri Lankan President Anura Kumara Dissanayake is set to unveil his government’s first national budget, a critical moment for his administration as the nation is dealing with a fragile economy. Sri Lanka is navigating the halfway point of its four-year, $3 bn bailout program from the International Monetary Fund (IMF) following its 2022 bankruptcy declaration. The budget will outline the government’s approach to meeting stringent financial targets tied to the bailout.

Elections in Asia 2025

Australians will head to the polls before May 17, 2025, with cost-of-living pressures and skyrocketing housing prices among the key issues on voters’ minds. Recent polls see a close race between the ruling Labor Party and the Liberal–National Coalition, in favour of the Coalition. With 78 seats, the government under Prime Minister Anthony Albanese currently has only a slim majority in the House of Representatives.

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Japan’s political landscape will take centre stage with the upper house election scheduled for mid-2025. For Prime Minister Shigeru Ishiba the election will be crucial. His ruling Liberal Democratic Party (LDP) lost its majority in the more powerful House of Representatives in a general election last year. Currently, LDP and its coalition partner Komeito hold the majority of the 248-member upper house.

Singapore’s 2025 general election in November is expected to be a pivotal moment for Prime Minister Lawrence Wong, who took over in May. As one of Asia’s key financial hubs, the election will likely influence trade, taxation, and foreign investment policies, especially amid ongoing global economic shifts. Investors will watch closely for any leadership or policy direction changes that could impact Singapore’s pro-business environment and regional economic role.

This month, the city-state raised its corporate tax rate, which is in line with OECD global minimum tax standards. Corporates now face a minimum of 15% tax. It remains to be seen if this will hurt Singapore’s reputation as a business-friendly financial hub.

Source:asia fund managers

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Alex

Economic

He said that the goal is achievable, provided that replanting efforts and innovation within the rubber industry are carried out comprehensively and systematically.

“I have discussed this with the director and chairman of the Rubber Industry Smallholders Development Authority (Risda), and I believe we can achieve this within 10 years. Malaysia has 800,000 hectares of rubber plantations, with 400,000 hectares in need of replanting,” said Zahid, who is also the rural and regional development minister.

“The replanting process must utilise high-quality saplings and automated methods for tapping and collection,” he told the media after attending the opening ceremony of the 2025 Risda Field Officers Convention here on Thursday.

Zahid also highlighted that the initiative includes promoting the use of rubber wood in the furniture industry, not as raw material, but as treated rubber wood, thus increasing its market value.

“This means that proceeds from rubber wood will become significantly more valuable. We anticipate this to provide a sufficient resource for Risda to operate independently, without relying on the government budget. This is our commitment, insya-Allah,” he said.

He also reflected on Malaysia’s former position as the global leader in the rubber industry, noting that the country is now ranked 10th.

“Currently, Malaysia’s share of the world’s rubber supply stands at just 50%. Meanwhile, our neighbouring country (Thailand) produces a third of global rubber production," he added.

“However, I am confident that, with the enthusiasm, dedication, and commitment of everyone involved, we will not only overcome the challenges ahead, but also elevate this industry to greater heights. Our goal is to reclaim the top position in the global rubber industry,” he said.

He emphasised the critical role of innovation, technology, and sustainable practices, in ensuring the continued competitiveness and productivity of Malaysia’s rubber sector.

Zahid said the initiative is part of the government’s broader strategy to foster rural development and reinforce the agricultural sector as a key pillar of the nation’s economy.

“We must be bold enough to move away from outdated practices. The rubber sector needs to become more appealing to the younger generation through the integration of modern technologies such as artificial intelligence, automation, and agricultural innovation,” he said.

“Imagine rubber plantations utilising the Internet of Things, drones to boost productivity, and e-commerce platforms linking smallholders directly to global markets. This isn’t just a transformation — it’s a revolution in the rubber industry that we all look forward to witnessing,” he added.

For over a century, Malaysia’s rubber industry has been a cornerstone of the country’s economic growth.

In 2023, the export value of Malaysia’s rubber industry, including rubberwood, was projected to reach RM37.2 billion, highlighting its significant role in the national economy.

During the tabling of Budget 2025, the government allocated various funds to support the rubber industry, including RM20 million to redevelop idle privately owned rubber plantations and RM60 million in matching grants under Risda for the smallholders’ latex production programme.

Source：theedgemalaysia

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Owen Li

Stocks

If there's one thing executives at Honda Motor and Nissan Motor need to fix first when - and if - they merge, it's their China business. The Japanese duo's sales have been falling for years in the world's largest car market. Joining forces would allow them to cut costs, not least on the new electric vehicles they need to vie with dominant rivals like BYD. But it's a go-slow tie-up, and their joint venture partners are wildcards.

In the 12 months to the end of March last year, the two between them sold 2 million vehicles in the country, company presentations show. That's second only to their U.S. operations. But it's a third less than they managed five years earlier. And because Chinese demand is growing, their combined market share fell faster, halving to around 8%. Meanwhile, comprehensive income in 2023 dropped 95% to 447 million yuan ($61 million) at Nissan's JV with Dongfeng Motor and nearly 90% at Honda's.

Shows Nissan and Honda's combined market share of China's passenger vehicle market has halved over five years.

As Dongfeng Motor works with both, condensing existing production lines and supply chains would seem relatively straightforward, in theory. Honda also has a partnership with GAC, which might be willing to consider a parting of the ways. There's a precedent: the Chinese group allowed former partner Mitsubishi Motors to exit its JV and adapted some of those manufacturing facilities for its own fast-growing EV brand.

A more efficient Chinese operation could help Honda and Nissan try to catch up on EVs. The laggards are developing around 10 electric-car models between them to sell in the People's Republic. Since they have a similar customer base, after merging they could focus on a smaller, more efficient range of products with a larger output per model.

However, JV partners could just as easily become an obstacle. Partnership terms are opaque, making it harder to judge whether restructuring is realistic. Even if Dongfeng and GAC are willing, the process would be tricky and time-consuming. Finding buyers for assets like surplus factories could be difficult given industry overcapacity.

Moreover, speed is not top of Honda and Nissan's to-do list. The two aren't envisioning a merger before August next year. And they have yet to broach the subject with their Chinese counterparts, a Honda executive told reporters, last week, acknowledging that they’ll need to talk “sooner or later”.

With BYD and peers growing, investors will hope it's sooner.

Honda Motor and Nissan Motor on Dec. 23 said they have signed a memorandum of understanding to spend six months discussing a potential business integration.

If the two carmakers agree to proceed around June 2025, they would first set up a holding company to be listed on the Tokyo Stock Exchange by August 2026, at which point both companies’ shares would be delisted.

Mitsubishi Motors, which is 34%-owned by Nissan, will decide by the end of January 2025 whether to join the discussions.

Source: Theedgemarkets

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Owen Li

Economic

However, recent data shows a shift in the global market landscape, with China gaining momentum. Despite a dip in its overall market share, South Korea remains a leader in key sectors like LNG (liquefied natural gas) and LPG (liquefied petroleum gas) carriers, a cornerstone of the industry’s future.

South Korea and China lead the industry

In recent years, the global shipbuilding industry has been dominated by Asian players, mainly South Korea and China. According to a report by UK-based Clarkson Research, China accounted for approximately 71% of global shipbuilding orders based on Compensated Gross Tonnage (CGT) in 2024, marking a significant surge. In contrast, South Korea’s market share dropped to 17%, widening the gap between the two nations from 40 percentage points in 2023 to 54 percentage points in 2024. Despite an increase in total orders, it is South Korea’s lowest level in eight years. Europe accounts for 6% and Japan for 4% of the global order book, according to Clarkson’s data.

China’s dominance stems from its ability to produce high-volume at lower cost. According to a study by ING Think, labour costs in China are about 50% less compared to Korea and Japan. In total, labour costs comprise more than 20% of production costs. Moreover, China is also the world’s cheapest steel manufacturer, making for competitive prices on that end.

South Korea to focus on smart, clean shipbuilding tech

While South Korea’s overall market share has declined, it leads in efficiency, having the highest ratio of shipbuilding per yard, and value. “Most of the orders received by Korean shipbuilders are for high-value vessels such as LNG carriers, LPG carriers, and VLCCs, and they come from reliable shipowners,” says ING’s Min Joo Kang, Senior Economist, South Korea and Japan.

Korean shipbuilders hold a dominant 93% share of the LPG carrier market. China, on the other hand, has experienced the strongest growth in exports of motor container ships over the last two years. “This is a segment that is not the primary focus of Korean and Japanese shipbuilders,” says Kang.

South Korea’s focus on eco-friendly technology and adherence to International Maritime Organization (IMO) regulations positions it as a leader in sustainable shipbuilding. Companies like Hyundai Heavy Industries and Samsung Heavy Industries are at the forefront of innovation, developing advanced LNG and dual-fuel carriers to meet growing global demand.

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The government is also supporting the shipbuilding industry by investing $1.44 bn over the next 10 years to collaborate with businesses in developing smart and clean energy technologies. In addition, international collaborations, for example with Norway to develop eco-friendly and smart vessels, strengthen the ambitions further.

Rising players in Asia’s shipbuilding industry

While China, South Korea and Japan currently account for more than 90% of the global shipbuilding industry, other Asian nations like Vietnam, the Philippines, and India are emerging as potential players with significant growth opportunities, the ING study highlights. However, barriers to entry remain high, as shipbuilding demands substantial capital, skilled labour, and often government support to compete with the established leaders.

Over the past decade, Vietnam’s shipbuilding industry has grown tenfold and is projected to maintain a compound annual growth rate (CAGR) of 6% from 2023 to 2032. The country is actively pursuing international cooperations, such as the joint shipyard between Hyundai Mipo and Vietnam’s Shipbuilding Industry Corporation (SBIC), which has grown into Southeast Asia’s largest shipyard.

India aims to become a top 10 shipbuilding nation by 2030. The government has launched key initiatives, such as the Financial Assistance Policy and infrastructure grants, to attract investment and reduce dependence on foreign shipping lines.

Looking ahead, Asia is in a good position to further lead the shipbuilding industry. ING names three factors: 1) The region’s central role in global trade, driven by rising intra-Asia trade flows, 2) Affordable yet skilled labour across emerging markets like Vietnam and the Philippines and 3) Government-backed strategies to support shipbuilding growth in countries such as India.

“The current upcycle in shipbuilding is poised to offer numerous opportunities for both emerging and established players,” says Kang. “Despite its cyclical nature, which inevitably brings future downturns, shipbuilders have demonstrated resilience and adaptability in managing past challenges. It is evident that shipbuilding will continue to be a significant growth driver in Asia.”

Source:asia fund managers

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Justin

Economic

The core inflation rate, which excludes private road transport and accommodation costs, was above the 1.7% forecast by a Reuters poll of economists and the 1.9% seen in November.

Headline inflation was 1.6% in annual terms in December, higher than economists' forecast of 1.5%.

Inflation has declined from a peak of 5.5% in early 2023 and December's rise is the smallest since November 2021, when it rose by 1.6%.

Lower inflation and higher growth have created room for the Monetary Authority of Singapore to ease monetary policy at its scheduled review on Friday, though analysts are split on whether the central bank would wait to assess the impact of US President Donald Trump's policies.

Singapore's economy did better than expected in 2024 with 4% growth in advance estimates, after slowing to 1.1% in 2023 from 3.8% in 2022.

The MAS has not changed policy since a tightening in October 2022, which was the fifth in a row, as broader concerns about growth kept authorities sidelined.

It last eased policy in March 2020 as Singapore braced for a recession with Covid-19 spreading worldwide.

The trade ministry is expecting growth of 1.0% to 3.0% in 2025.

Source：theedgemalaysia

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Cohen

Economic

Anwar, who is also the finance minister, said the agreement was reached through a meeting with the company’s leadership team led by Fortescue executive chairman and founder Andrew Forrest AO on the sidelines of the World Economic Forum (WEF) Annual Summit 2025 here.

“The Sarawak government has agreed in principle, and I have guaranteed several incentives and support, so that Bintulu will become a hub,” he said at the closing press conference in conjunction with his working visit to the WEF 2025.

On Tuesday, Anwar led a Malaysian delegation to attend face-to-face business meetings organised by the Ministry of Investment, Trade and Industry with corporate leaders representing Fortescue, AstraZeneca, DP World, Medtronics, Nestlé and Google.

Commenting further, the prime minister explained that through meetings with companies investing in Malaysia, the large port company from Dubai, DP World, which comes into Sepanggar, Sabah, had received the support of the federal government.

“As for Sabah, which will have a relatively large port in the region when Dubai Ports comes in, the federal government has informed Chief Minister Datuk Seri Hajiji Noor and the Sabah government to provide full support and cooperation,” he added.

In addition, the prime minister said Google would continue implementing major programmes, such as the one established in Selangor, namely data centres that would benefit Peninsular Malaysia, particularly Johor, Penang and Perak.

Furthermore, he said that issues related to artificial intelligence, including in the fields of medicine and education, were also discussed in the meetings with global companies.

Anwar attended the WEF 2025 from Monday to Wednesday, for the first time as Malaysia's prime minister since taking office in 2022, at the invitation of WEF founder and chairman of the board of trustees Klaus Schwab.

Throughout the three-day visit, Anwar was accompanied by Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz, Higher Education Minister Datuk Seri Dr Zambry Abdul Kadir, and Digital Minister Gobind Singh Deo.

Source：theedgemalaysia

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Justin

Commodity

Citing trading sources, Bloomberg reported that the effect of the sanctions in crude oil prices in Asia has been so pronounced that in some cases it has pushed refining margins below zero. Most of the refiners affected by the ripple effect of the sanctions were in South Korea, Singapore, and Taiwan, the report noted, and normally buy Saudi crude, which is priced against benchmarks such as Oman, which is currently soaring amid the replacement rush.

In the latest sanction package, reported to be the harshest yet, the Treasury of the outgoing Biden administration imposed sanctions on Gazprom Neft and Surgutneftegaz, as well as on 183 tankers, many of them in the so-called shadow fleet Russia uses to ship its oil abroad without having to use Western vessels or insurance.

“The new Russian sanctions from the outgoing administration are a net addition to at-risk supply, adding more uncertainty to the (first quarter) outlook,” RBC Capital Markets said in a note at the time. Other forecasters warned of a further supply tightening in an already tight market, mostly because of the tanker sanctions. Following the release of the package, oil prices rose to highs not seen in months.

The sanctions will be most painful for India, analysts warned, as the country depends on imports for over 80% of its oil consumption and was the biggest beneficiary of affordable Russian crude, a lot of which has now become unavailable. According to Kpler, 75 of the sanctioned tankers were used to transport crude oil from Russia to India.

“Most of these barrels went to Indian refiners and, hence, the impact will likely be largest there,” BNP Paribas senior commodity strategist Aldo Spanier told CNBC earlier this month.