1The reading in brief
Ten of the eleven ASEAN markets recorded business conditions above the neutral reference in 2025, across a spread of 43.5 index points.
10 of the eleven markets score above the neutral reference of fifty. The highest reading is Viet Nam at 83.2, on component scores of 90.1 for growth and 86.0 for trade momentum. Malaysia follows at 82.6, with capital flow momentum at the upper bound. The lowest is Myanmar at 39.7.
The Index scores five components — growth momentum, trade momentum, capital flow momentum, trade engagement and price stability — each drawn from the World Bank’s World Development Indicators for the 2025 reference year and mapped to a 0–100 scale by a published formula. The GDP-weighted composite across the eleven markets is 69.4. Excluding Myanmar moves the composite to 70.0.
All five components are drawn from the World Bank’s World Development Indicators. Four of the five carry the 2025 reference year for every market. On capital flow momentum the World Bank publishes no 2025 value for Malaysia, Viet Nam, Myanmar or Lao PDR, so those four markets are scored on 2024, their latest available year; each says so on its own row below.
Key message 1Viet Nam has the region’s best business conditions, but the capital has not followed
Viet Nam leads the Index at 83.2, and leads on three of the five components: growth momentum at 90.1, trade momentum at 86.0 and trade engagement at 90.0. On capital flow it scores 59.0, mid-table, behind Malaysia, Brunei Darussalam, Thailand, Singapore, Cambodia and Timor-Leste. The operating conditions investors describe as decisive are present in Viet Nam; the capital is not arriving in proportion to them.
Key message 2Malaysia is the only market in the region that is strong on all five measures at once
Malaysia scores above 75 on every one of the five: growth 75.9, trade momentum 77.1, capital flow 100.0, trade engagement 75.9 and price stability 93.8. It ranks second overall at 82.6. Every other market in the eleven carries at least one component in the bottom third of its range: Viet Nam on capital flow, Singapore on trade momentum, Indonesia and the Philippines on trade engagement, Lao PDR on capital flow, Brunei Darussalam on trade momentum. Malaysia is the region’s most complete market on these five measures, and it is the only one.
Key message 3ASEAN’s two biggest economies trade the least, relative to their size
The Index measures trade engagement as merchandise trade against the size of the economy. Indonesia trades the equivalent of 36% of its GDP and the Philippines 46%, against Viet Nam at 180% and Singapore at 178%. On the Index that is 18.1 and 23.1 against 90.0 and 88.8 — a gap of 71.9 index points, the widest of any component except capital flow. Both countries grow well: Indonesia scores 75.5 on growth, above Singapore at 75.1, and the Philippines 72.0. Both are large economies whose output is absorbed largely at home. That one measure is what keeps both out of the top half of the Index.
2Business Conditions Index 2025
The Index summarises recorded business conditions in each market on a scale where fifty is neutral: output produced, goods traded, capital committed, trade exposure, and the stability of prices. It is descriptive. It reports what was recorded in the reference year and makes no forecast.
Finding 1Trade exposure, rather than growth, accounts for the difference between the highest- and lowest-scoring markets
The four lowest composites are not the four slowest-growing markets. Indonesia scores 75.5 on growth momentum, fifth of the eleven and above Singapore at 75.1; the Philippines scores 72.0, eighth. Indonesia nonetheless scores 61.5 and the Philippines 60.3, against Singapore at 76.7. What separates them is trade engagement, where Indonesia scores 18.1 and the Philippines 23.1 against Singapore’s 88.8 and Viet Nam’s 90.0. Both are large domestic-demand economies, and the Index reads a domestic economy as less exposed to the region than an open one. The composite therefore measures openness as much as momentum, and should be read accordingly.
| Market | Growth 35% | Trade momentum 22% | Capital flow 18% | Trade engagement 13% | Price stability 12% | BCI | Coverage |
|---|---|---|---|---|---|---|---|
| 🇻🇳Viet Nam | 90.1 | 86.0 | 59.0 | 90.0 | 86.9 | 83.2 | 5 of 5 |
| 🇲🇾Malaysia | 75.9 | 77.1 | 100.0 | 75.9 | 93.8 | 82.6 | 5 of 5 |
| 🇰🇭Cambodia | 76.7 | 85.4 | 66.0 | 63.5 | 96.5 | 77.4 | 5 of 5 |
| 🇸🇬Singapore | 75.1 | 72.5 | 67.8 | 88.8 | 89.0 | 76.7 | 5 of 5 |
| 🇹🇭Thailand | 62.2 | 75.8 | 81.7 | 59.3 | 78.7 | 70.3 | 5 of 5 |
| 🇹🇱Timor-Leste | 84.9 | 53.4 | 62.3 | 28.4 | 84.3 | 66.5 | 5 of 5 |
| 🇱🇦Lao PDR | 72.7 | 100.0 | 5.5 | 62.1 | 42.6 | 61.6 | 5 of 5 |
| 🇮🇩Indonesia | 75.5 | 60.6 | 41.8 | 18.1 | 99.1 | 61.5 | 5 of 5 |
| 🇵🇭Philippines | 72.0 | 66.4 | 32.9 | 23.1 | 96.6 | 60.3 | 5 of 5 |
| 🇧🇳Brunei Darussalam | 53.3 | 28.2 | 100.0 | 55.0 | 77.0 | 59.3 | 5 of 5 |
| 🇲🇲Myanmar | 39.9 | 66.5 | 22.1 | 18.1 | — | 39.7 | 4 of 5 |
Finding 2Capital flows vary more widely across ASEAN than any other measure, yet correspond least with overall position
Capital flow is the component on which the eleven differ most, spanning 94.5 points from Lao PDR at 5.5 to Malaysia and Brunei Darussalam at 100.0. Growth momentum, which carries the heaviest weight at 35%, spans only 50.2 points. The measure that most distinguishes these markets from one another is therefore also the measure that corresponds least with their overall position. Brunei Darussalam records the region’s joint-highest capital score and ranks tenth of the eleven. Lao PDR records the lowest at 5.5 and ranks seventh, above both Indonesia and the Philippines. Viet Nam, first on the Index overall, ranks seventh on capital. Capital allocation in 2025 did not follow measured business conditions.
Finding 3Price stability was general across the region and did not differentiate between markets
Price stability was general across ASEAN in 2025 and separated no one. The three highest readings belong to Indonesia at 99.1, the Philippines at 96.6 and Cambodia at 96.5 — which rank eighth, ninth and third respectively. Lao PDR records the weakest price stability of the eleven at 42.6 and nonetheless ranks seventh, above both Indonesia and the Philippines. Price stability conferred no advantage in overall position; it was a condition common to the region rather than a point of differentiation.
The eleven markets, one by one
Underlying series: World Bank World Development Indicators, reference year 2025.
GROWTH 90.1 · TRADE MOM. 86.0 · CAPITAL 59.0 · TRADE ENG. 90.0 · PRICES 86.9
GDP growth of 8.0% is the highest recorded of the eleven and maps to a growth score of 90.1. Merchandise trade stands at 180.0% of GDP, giving a trade-engagement score of 90.0, and total merchandise trade rose 18.0% on the prior year. Capital flow momentum is the lowest of its five components at 59.0, on a 9.0% change in recorded inflows; that reading uses 2024 as its latest available year. Consumer price inflation of 3.3% is the second-highest of the eleven.
GROWTH 75.9 · TRADE MOM. 77.1 · CAPITAL 100.0 · TRADE ENG. 75.9 · PRICES 93.8
Capital flow momentum sits at the upper bound of 100.0, on a 96.9% increase in recorded inflows — the largest proportional increase of the eleven. Growth of 5.2% and merchandise trade of 151.7% of GDP both map to 75.9. Inflation of 1.4% gives a price-stability score of 93.8. The capital-flow reading uses 2024 as its latest available year.
GROWTH 76.7 · TRADE MOM. 85.4 · CAPITAL 66.0 · TRADE ENG. 63.5 · PRICES 96.5
Total merchandise trade rose 17.7% on the prior year, giving the third-highest trade-momentum score at 85.4. Inflation of 2.4% produces a price-stability score of 96.5. Trade engagement is its lowest component at 63.5, on merchandise trade of 127.1% of GDP.
GROWTH 75.1 · TRADE MOM. 72.5 · CAPITAL 67.8 · TRADE ENG. 88.8 · PRICES 89.0
Merchandise trade of 177.6% of GDP is the second-highest of the eleven and gives a trade-engagement score of 88.8. Growth of 5.0% maps to 75.1 and inflation of 0.9% to 89.0. Recorded inflows rose 17.8%. Singapore’s share of recorded regional investment inflows, and the pass-through limitation that bears on it, are set out in the aseanx FDI Pulse.
GROWTH 62.2 · TRADE MOM. 75.8 · CAPITAL 81.7 · TRADE ENG. 59.3 · PRICES 78.7
Growth of 2.4% is the second-lowest of the eleven and maps to 62.2. Recorded inflows rose 31.7%, giving a capital-flow score of 81.7 — its highest component. Consumer prices fell 0.1% over the year; the price-stability mapping scores distance from a two per cent reference in either direction, so deflation of 0.1% returns 78.7.
GROWTH 84.9 · TRADE MOM. 53.4 · CAPITAL 62.3 · TRADE ENG. 28.4 · PRICES 84.3
Growth of 7.0% is the second-highest of the eleven and maps to 84.9. Trade engagement is the constraint at 28.4, on merchandise trade of 56.9% of GDP. Total merchandise trade rose 1.7%. Timor-Leste acceded to ASEAN on 26 October 2025 and is scored here on the same five components as every other market.
GROWTH 72.7 · TRADE MOM. 100.0 · CAPITAL 5.5 · TRADE ENG. 62.1 · PRICES 42.6
The widest internal dispersion of the eleven. Trade momentum is at the upper bound of 100.0, on merchandise trade growth of 25.9% — above the ±25 point cap. Capital flow momentum is 5.5, on a 44.5% fall in recorded inflows; that reading uses 2024 as its latest available year. Inflation of 7.7% is the highest of the eleven and returns a price-stability score of 42.6.
GROWTH 75.5 · TRADE MOM. 60.6 · CAPITAL 41.8 · TRADE ENG. 18.1 · PRICES 99.1
Inflation of 1.9% is the closest of the eleven to the two per cent reference and returns the highest price-stability score at 99.1. Trade engagement is 18.1, on merchandise trade of 36.3% of GDP — the lowest ratio of the eleven alongside Myanmar. The two trade components carry 35% of the weight. Recorded inflows fell 8.2%.
GROWTH 72.0 · TRADE MOM. 66.4 · CAPITAL 32.9 · TRADE ENG. 23.1 · PRICES 96.6
The same pattern as Indonesia at a smaller scale: growth of 4.4% maps to 72.0 while trade engagement is 23.1, on merchandise trade of 46.2% of GDP. Inflation of 1.7% returns 96.6. Recorded inflows fell 17.1%, giving a capital-flow score of 32.9.
GROWTH 53.3 · TRADE MOM. 28.2 · CAPITAL 100.0 · TRADE ENG. 55.0 · PRICES 77.0
Capital flow momentum is at the upper bound of 100.0, on a 112.7% increase from a recorded base of US$61.8 million — the smallest inflow of the eleven, where a proportional change carries little scale. Total merchandise trade fell 10.9%, the only decline of the eleven, giving a trade-momentum score of 28.2. Growth of 0.7% is the lowest positive rate recorded.
GROWTH 39.9 · TRADE MOM. 66.5 · CAPITAL 22.1 · TRADE ENG. 18.1 · PRICES —
The only market to record a contraction: GDP fell 2.0%, giving a growth score of 39.9. Recorded inflows fell 27.9%, on 2024 as the latest available year. No consumer price series is compiled for the market for the reference period, so the price-stability cell is empty, the remaining four weights are renormalised, and the market is flagged as scoring on four of five components.
Myanmar scores on four of five components. No consumer price series is compiled for the market for the reference period, so its price-stability cell is empty and the remaining four weights are renormalised. Excluding Myanmar entirely moves the regional composite from 69.4 to 70.0 — a difference of 0.6 points, because the market represents under two per cent of regional output.