The UOB Business Outlook Study 2025 reveals key strategy shifts in response to a changing global landscape. Despite rising inflation and the impact of new U.S. import tariffs, half of Indonesian businesses remain optimistic. The study, which surveyed more than 535 SMEs and large enterprises in Indonesia, highlights a growing focus on digital transformation, sustainability, and global expansion.
Indonesia Business Outlook Reflects Growing Caution
The Indonesia business outlook for 2025 shows a notable dip in optimism. Only one in two businesses still expect positive prospects, a sharp decline from 90 percent the previous year. New U.S. tariffs, high inflation, and rising operational costs are contributing to this cautious sentiment.
In response, companies are reassessing their strategies to maintain resilience. The study notes that 51 percent of businesses anticipate continued inflation, while 52 percent expect raw material prices to rise significantly. These economic pressures have pushed many businesses to explore new revenue streams and rethink their positioning.
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Digital Transformation Strategy Gains Momentum
Digital transformation strategy has become a top priority for businesses seeking efficiency and stability. Two out of three companies plan to increase digital spending by 10 to 25 percent in 2025. Meanwhile, one in five companies aims to boost spending by up to 50 percent.
Improving data protection and security stands out as the primary driver of digital investment. At the same time, financial technology adoption remains high. The study found that 94 percent of businesses have already adopted or plan to use fintech solutions, particularly for finance, accounting, and investment needs.
Businesses Embrace Sustainability to Stay Competitive
More than half of businesses have started implementing sustainability initiatives in the wake of U.S. tariff changes. This shift is evident among both small (56 percent) and medium-sized (64 percent) companies. The consumer goods and manufacturing sectors lead this movement, with adoption rates of 67 percent and 59 percent, respectively.
Several factors are driving this change. Companies cite brand reputation, customer demand, investor expectations, and alignment with multinational ESG standards. However, high product costs and limited renewable energy infrastructure still pose major challenges.
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ASEAN Trade and Global Market Expansion on the Rise
Global market expansion is emerging as a key growth strategy. Despite global trade disruptions, many businesses anticipate increased intra-ASEAN trade as a result of shifting tariff landscapes. Over half of the respondents plan to accelerate international expansion to tap into broader opportunities.
Medium-sized companies, as well as firms in the healthcare and wholesale trade sectors, express the strongest intent to expand abroad. Diversifying market presence is also a risk management tactic as companies aim to reduce reliance on any single region.
Talent and Labor Remain Top Challenges
Labor issues continue to weigh heavily on business operations. Eight out of ten companies cite workforce challenges as a top concern. Approximately one-third of firms expect these pressures to intensify following the implementation of new U.S. tariffs.
Rising operational costs and inflation further exacerbate hiring difficulties. The study points to the urgent need for strategies that enhance productivity and attract skilled talent amid economic volatility.
Resilience Shapes Indonesia’s Business Future
The UOB Business Outlook Study 2025 reflects how Indonesian businesses are adapting with resilience and foresight. “The UOB Business Outlook Study 2025 reflects the resilience and adaptability of Indonesian businesses amid global changes. Despite caution over external factors such as U.S. tariffs, we see a strong commitment to digitalization and sustainable practices,” said Harapman Kasan, Director of Wholesale Banking at UOB Indonesia, as cited by Metrotvnews.com
He added, “Efficiency, competitiveness, and investment are key. UOB Indonesia is ready to support businesses with tailored financial solutions and expert guidance to help them seize growth opportunities amid change.”
With shifting strategies and a focus on innovation, businesses in Indonesia are positioning themselves for long-term success in a dynamic global environment
Source: metrotvnews.com
Image: Canva Images
