In the face of global supply chain restructuring, Chinese private enterprises are actively pursuing strategic acquisitions in Southeast Asia to secure their future competitiveness.
2025 has witnessed a significant surge in cross-border mergers and acquisitions (M&A) by Chinese private enterprises, particularly across Southeast Asia. This trend represents a strategic pivot towards supply chain resilience and market access in one of the world’s most dynamic economic regions.
Driven by trade tensions, geopolitical considerations, and the pursuit of growth, companies are leveraging M&A to rapidly establish footholds in key markets while diversifying their production bases beyond China.
The current wave of Chinese M&A activity in Southeast Asia is underpinned by multiple strategic imperatives. “Supply chain resilience” has become a paramount concern for Chinese manufacturers facing geopolitical uncertainties and trade barriers.
According to a 2025 report on Asian supply chain reshaping, global supply chains are shifting from highly integrated networks toward “multi-polar” competitive structures, with Europe, North America, and Asia each building their own supply chain systems.
The pursuit of market access represents another critical driver. With nearly 700 million people and a growing middle class, ASEAN offers not just manufacturing advantages but also substantial consumer or end user markets. As noted in the Dahua Bank Enterprise Outlook Survey Report 2025, Chinese companies regard ASEAN as their most important overseas procurement market, end market, and future investment destination.
Chinese investments are increasingly targeting strategic sectors that align with both regional demands and global trends. Technology and digital infrastructure have emerged as prime investment categories, reflecting Southeast Asia’s rapid digital transformation.
The region’s digital economy is projected to reach US$1 trillion by 2030, potentially doubling if the ASEAN Digital Economy Framework Agreement is successfully implemented.
The green energy transition is creating additional opportunities. Chinese companies in solar, battery, and electric vehicle sectors are establishing production bases in ASEAN countries, with Indonesia particularly emerging as a hub for electric vehicles.
Chinese companies are moving beyond simple “China+1” approaches toward more sophisticated “China+N” strategies that span multiple ASEAN markets. This evolution reflects a more mature phase of internationalization, where companies are transforming from cost-oriented producers into trusted market participants and contributors.
According to the Dahua Bank report, Malaysia currently enjoys the highest preference among Chinese investors, followed by Thailand, Singapore, and Indonesia . This diversified approach allows companies to leverage each country’s unique advantages while building resilient regional networks.
The recently concluded China-ASEAN Free Trade Area 3.0 negotiations are expected to further facilitate this trend by reducing market entry barriers for Chinese companies, enhancing connectivity between markets, and lowering operating costs.
Expanding into Southeast Asia through M&A presents significant challenges that require careful management. Navigating diverse regulatory environments remains a complex task, with varying legal systems, tax policies, and labor regulations across ASEAN member countries.
Successful post-acquisition integration requires deep understanding of local business cultures and practices. Companies are addressing this by partnering with local partners, experts and financial institutions with regional expertise.
The outlook for Chinese M&A activity in Southeast Asia remains positive. The region’s fundamental advantages—proximity to China, favorable demographics, and supportive policy environments—continue to attract investment across multiple sectors.
PwC forecasts that China’s overall M&A transaction value could achieve double-digit growth in 2025, driven by factors including overseas investment demand, particularly in Southeast Asia.
As Chinese companies continue to expand their presence across ASEAN, their approach is evolving from pure asset acquisition toward building sustainable regional enterprises. This shift reflects a longer-term perspective that emphasizes local integration, corporate social responsibility, and cultural understanding.
ARC Group is currently advising clients in consulting and outbound M&A in Southeast Asia, especially in the advanced manufacturing, financial services and chemicals sectors. We hope to assist more companies in achieving their regional supply chain layouts and goals.
References:
2025年亚洲供应链重塑：中国企业如何穿越周期报告
专访渣打新加坡及东盟CEO李福祐：中国对东盟投资聚焦创新产业_企业_世纪_服务
普华永道：并购市场持续活跃，2025年交易额或实现两位数增长 — 新京报
中国企业并购市场2025年中回顾及展望报告-普华永道
Dongguan Chamber of Commerce Delegates Explore Business Opportunities in the Philippines
《大华银行企业展望调查报告2025(中国内地篇)》
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