Asia Pacific News
LAST UPDATE: September 30, 2025
Tariffs, Uncertainty to Slow Asia’s Economic Growth, ADB Says
The Asian Development Bank warns that tariffs and economic uncertainty are expected to decelerate economic growth across Asia. Trade tensions and policy unpredictability create headwinds for the region’s export-driven economies. The ADB has revised down its growth forecasts for Asian economies.
Insight
This reflects growing concern about the impact of protectionist trade policies on Asia’s interconnected supply chains and export sectors, potentially affecting investment and manufacturing.
China Factory Activity Improves But Slump Reaches Six Months
Chinese manufacturing activity showed slight improvement in the latest month, but the industrial sector has now been in a slump for six consecutive months. Weak domestic and external demand continue to weigh on factory output. The prolonged downturn highlights ongoing challenges in China’s economic recovery.
Insight
The extended manufacturing weakness suggests China’s economic stimulus measures have yet to generate sustained momentum, raising questions about the effectiveness of current policies.
North Korea to further strengthen ties with China, foreign minister says
North Korea’s foreign minister announced plans to deepen the country’s relationship with China. The statement emphasizes continued cooperation between the two nations amid regional tensions. This reaffirms the strategic partnership between Pyongyang and Beijing.
Insight
The pledge signals North Korea’s continued reliance on China as its primary diplomatic and economic partner, particularly as international sanctions remain in place.
BOJ Keeps Ample Room for Rate Hike Without Clear Hint on October
The Bank of Japan maintains flexibility for potential interest rate increases but has not provided definitive signals about action in October. Policymakers are assessing economic conditions and inflation trends. The central bank’s cautious stance reflects uncertainty about the strength of Japan’s economic recovery.
Insight
This indicates the BOJ is in a wait-and-see mode, balancing the need to normalize policy against risks to fragile growth and the potential impact of global economic headwinds.
Japan’s Output Falls as US Tariffs Drag On Global Outlook
Japanese industrial output has declined as US tariffs weigh on global economic prospects and trade flows. Export-dependent sectors are particularly affected by the deteriorating international trade environment. The production decrease reflects broader concerns about global demand.
Insight
This underscores how US trade policy is having spillover effects on allied economies like Japan, potentially complicating coordination on economic and security issues.
South Korea’s Lee, outgoing Japan PM Ishiba hold talks on better ties, US trade deals
South Korean President Lee and departing Japanese Prime Minister Ishiba discussed improving bilateral relations and coordinating on US trade agreements. The meeting aimed to strengthen cooperation between the two neighbors amid regional challenges. Both leaders emphasized the importance of trilateral coordination with the United States.
Insight
The talks suggest efforts to overcome historical tensions and present a united front in negotiations with the US on trade, particularly as both face potential tariff pressures.
South Korea to ease criminal punishments for businesses, finance minister says
South Korea’s finance minister announced plans to reduce criminal penalties for business-related offenses. The move is intended to create a more business-friendly environment and encourage corporate investment. The policy shift reflects government efforts to stimulate economic activity.
Insight
This represents a significant regulatory change aimed at attracting capital and reducing the perceived risks of doing business in South Korea, though it may raise corporate governance concerns.
India extends export incentive scheme until March 2026
India has extended its Remission of Duties and Taxes on Export Products (RoDTEP) scheme until March 2026 to continue reimbursing exporters for taxes and levies not refunded elsewhere.
Insight
The extension offers exporters continued support amid elevated trade tensions and can act as a buffer against external tariff shocks.
Indonesia vows $2bn Christmas stimulus as economy flags
Indonesia will deploy a $2 billion stimulus targeting transport, groceries, retail, and airline tickets ahead of Christmas to cushion weak consumption.
Insight
The move underscores Indonesia’s anxiety over slowing domestic demand and reflects a shift toward proactive fiscal support.
Australia Holds Key Rate, Signals Renewed Price Pressure
The Reserve Bank of Australia held its key rate at 3.6 %, while warning that inflation could rebound more strongly than expected.
Insight
The decision suggests the RBA remains cautious and may delay further easing until inflation trends become clearer.
