Hong Kong’s business community is entering 2026 with renewed optimism, according to the Chamber’s latest Business Prospects Survey. Despite ongoing global challenges, businesses in Hong Kong remain notably positive, with nearly half expressing confidence in the city’s economic outlook over the next 12 months – a significant improvement from last year’s results.
The latest figures tell a compelling story. A total of 48.3% of respondents – the highest level in recent years – said they were optimistic about the city’s business conditions in the coming 12 months, up sharply from just 18.3% last year.
When it comes to business performance, 70% of companies reported either increased (28.8%) or stable (41.5%) turnover in the first 10 months of 2025. Large enterprises appear to have a stronger footing than SMEs, likely benefitting from broader market reach and greater capacity to absorb volatility when navigating external challenges. For the coming year, 40.3% expected an increase in business turnover, up from 31.3% last year, underscoring positive sentiment.
This optimism marks a stark contrast with last year, when U.S. President Trump’s tariff threats created significant uncertainty. The recent U.S.-China tariff truce and ongoing peace talks between Israel and Palestine may have buoyed confidence. Nevertheless, the global economic slowdown remains the most pressing challenge for Hong Kong businesses, with an average rating of 3.79 out of 5. Other key concerns include high operating costs (3.68) and heightened geopolitical tensions (3.56).
Investment Hotspots: GBA & Emerging Markets
While businesses seem to be taking a wait-and-see approach toward capital investment in Hong Kong – with 65.7% expecting to maintain current investment levels in the year ahead – sentiment was considerably more optimistic for outbound investments aimed at diversifying risk and tapping into new opportunities.
The Greater Bay Area (GBA) (excluding Hong Kong) continues to stand out as a key investment hotspot. For respondents who were already operating in the region, 38.7% indicated they would increase investment over the next 12 months, a rise from 34% in last year’s survey, with only a small proportion of 3.7% anticipating scaling back, underscoring the GBA’s enduring appeal as an engine for growth and innovation.
Heightened concerns over rising protectionism and prolonged volatility in U.S. trade policy under the Trump administration have amplified uncertainty across global supply chains. To navigate these challenges, businesses must strengthen regional market linkages and prepare for unexpected shifts in the external environment. Reflecting this, Hong Kong businesses are increasingly diversifying their investments into emerging markets, particularly Southeast Asia. About 41.1% of respondents planned to boost their investments in ASEAN over the next 12 months, while 26.2% intended to increase investments in the Middle East.
Accelerating AI Adoption Digital transformation has emerged as a cornerstone of enterprise competitiveness and a key driver for unlocking sustainable growth in today’s evolving market landscape. Although over 90% of respondents were integrating AI and other digital technologies into their business operations, most remained at a moderate (45.8%) or limited (30.9%) stage of adoption.
Unsurprisingly, SMEs were progressing more slowly in digital transformation, with 14.3% not adopting any of these technologies, compared to just 1.8% of large enterprises, highlighting a pressing gap that must be bridged for businesses to fully unlock AI’s transformative potential.
Among those who have already adopted AI and other digital technologies, 75.5% cited increased operational efficiency as the most notable benefit. Other advantages included lower operating costs (40.7%), reduced human error through automation (38.9%) and enhanced product or service quality (37%).
Demand for Tech Talent
Looking ahead, progress toward further digitalization appears somewhat sluggish, with only 24.3% of respondents optimistic about achieving noticeable advancements and completing digital transformation in the short term. In terms of readiness, respondents indicated they are only moderately prepared for deeper digitalization – across areas such as software and data infrastructure, business processes, financial resources and workforce capabilities.
Correspondingly, the shortage of technical talent is clearly hindering businesses in their digital transformation journey, cited by over half of respondents (53.8%), followed by the high upfront investment required (38.6%).
The growing adoption of AI and digital technologies is prompting some businesses to restructure their workforces. On hiring intentions, 22.5% of respondents planned to recruit more staff, while over half (55.9%) expected to maintain their current headcount in 2026. Only 12.3% anticipate reducing staff, down from 17.4% last year. While AI-driven innovation may lead to short-term job displacement, it is also expected to create new opportunities in the long run.
Closing this gap, firms must empower employees through continuous AI skills development and more decisive investments in software and data infrastructure, strengthening organizational readiness and better positioning themselves to thrive amid the rapid rise of the digital economy.
A Promising 2026
In early 2025, Hong Kong businesses were pessimistic about the business environment amid concerns of a renewed trade war. However, since the beginning of the year, Hong Kong’s economic performance has exceeded expectations. The “front-loading” effect of exports amid trade tensions, coupled with strong demand for electronic components driven by AI investment, has fuelled robust export growth. The IPO market has also staged a remarkable recovery, with 91 listings in the first eleven months raising nearly $260 billion – ranking first globally and setting a new record. Combined with a rebound in private consumption and expanding local demand, overall economic performance has been impressive.
Looking ahead to 2026, Hong Kong’s economy is expected to maintain steady growth, supported by a buoyant stock market – particularly the IPO segment, which could reach another new high. The one-year trade truce agreement between the U.S. and China, which came at the end of October, has eased uncertainty in the external trade environment, providing short-term support for Hong Kong’s exports.
However, challenges remain. Faltering global growth, lingering tariff impacts and continued uncertainty in U.S. trade policy could significantly slow global trade. Adding to this, the Federal Reserve leadership change brings uncertainty over the pace of future interest rate cuts. Meanwhile, the increasing adoption of AI is expected to reshape the labour market, likely reducing entry-level vacancies and keeping the overall unemployment rate relatively high in the near term.
Hong Kong has demonstrated remarkable resilience amid global uncertainty. Looking ahead, the economy faces a mix of strengths and vulnerabilities. While the local business environment should improve, sluggish global growth, heightened geopolitical risks and the accelerating AI race will continue to reshape markets, potentially redefining the global economic landscape.
About the Survey
The annual Business Prospects Survey, conducted from 30 October to 12 November 2025, received a total of 236 valid responses. Professional and business services accounted for the most respondents (23.7%), followed by trading companies (18.6%), and property/construction (9.3%).