Hong Kong amongst top APAC expansion targets amidst rising trade tensions

The region attracted expansion interest from 29% of APAC executives.

Hong Kong ranks amongst the top three expansion destinations for Asia Pacific (APAC) companies, as executives shift capital toward regional markets—representing 29% of APAC executives—according to a Forvis Mazars report.

Trade disruptions from the US-Israel conflict with Iran and tariff threats have driven this move toward trusted regional hubs, with 50% of APAC firms changing their target expansion countries last year.

Amongst these businesses, 67% cite geopolitical instability as the reason for the shift, the report noted.

Regional expansion provides the regulatory and operational certainty these organisations seek.

Whilst the number of leaders expecting revenue growth fell to 67% from 80% in 2025, as overall business confidence rose to 41% from 30%.

This indicates that executives are focusing on structural resilience to buffer against global shocks.

Artificial intelligence serves as a tool for efficiency and job creation, prompting the creation of new roles in 43% of organisations, whilst 28% reported job replacements.

Businesses are addressing the talent crunch through investment, with 63% funding new talent acquisition and 68% focusing on workforce upskilling.

A gap remains between sustainability compliance and operational readiness. Whilst 91% of executives express confidence in meeting ESG reporting requirements, only 73% feel prepared for the physical climate shocks that could impact relocated operations.

Current strategies favour shortened supply chains to manage costs and operational issues linked to tariffs, the report said.

It also indicates that 42% of firms view tariff-related costs as a major challenge for expansion, with the pivot to intra-regional trade serving as a practical step to insulate operations against escalating global risks.