banner image
News

Malaysia Reserve: Malaysian biz cautiously optimistic amid rising competition

01 Oct 2025 5 min read

As published on The Malaysian Reserve, 9 October 2025

MALAYSIAN businesses are showing cautious optimism in the third quarter of 2025 (3Q25), according to the Grant Thornton International Business Report (IBR), even as they grapple with rising competition, economic uncertainty, and shortages of skilled workers. 

The survey shows that 57% of Malaysian businesses are optimistic about the country’s economy over the next 12 months, a decrease of seven points from 64% in 2Q25. 

Meanwhile, more business leaders are planning to increase selling prices, with 52% reporting intentions to do so, up eight points from 44% in 2Q25, reflecting pricing pressures in competitive or inflation-sensitive markets. 

Despite this optimism, fewer expect revenue growth, with 56% anticipating an increase in revenue, down slightly from 58% in 2Q25, indicating that companies remain realistic about the challenges ahead. 

Businesses are also looking beyond domestic borders to drive growth. 

Exports have increased marginally to 40% from 38% in 2Q25, while the share of businesses selling to more countries rose to 42% from 36%, with revenue from non-domestic markets increasing to 42% from 34%. 

Globally, optimism has returned to record levels. 

According to the IBR, 76% of businesses are optimistic about the outlook for their economy over the next 12 months, marking the first increase in optimism this year and matching levels seen in 4Q24, prior to the announcement of US tariffs. 

“The biggest shake-up in global trade in years has created both disruption and opportunity. Malaysian businesses are responding with intent by raising selling prices to offset cost pressures while also expanding into more markets to build resilience and competitiveness,” said Grant Thornton Malaysia plt country CEO Kishan Jasani. 

Rising Business Constraints

Competition has emerged as the most cited constraint, jumping 15 points to 55%, followed by economic uncertainty and availability of skilled workers at 51% each. 

 The IBR attributes the rise in competitive pressure to changing tariff landscapes, market fragmentation, and the race to capture new international opportunities. 

Supply chain concerns have also grown, with 36% of business leaders citing complexity as a constraint, up two points from the previous quarter, reflecting ongoing global value chain reconfigurations due to tariffs, regionalisation, and nearshoring trends. 

Strong Investment Intentions

Despite these challenges, investment intentions remain robust. 

Information technology and people development are top priorities, with 55% planning to increase spending over the next 12 months. 

Within IT, 66% plan to invest in artificial intelligence (AI), while 78% of businesses are investing in upskilling their workforce. 

Investment in brand and research and development has also surged, rising to 51% in both areas, up twenty and sixteen points, respectively, from 2Q25. 

“This rise reflects a strategic shift towards building intangible assets that drive long-term competitiveness rather than focusing solely on immediate output. As businesses expand internationally, brand recognition and innovation will be critical in enhancing their competitive edge,” Kishan added. 

Looking Ahead 

“The latest IBR findings show that while Malaysian businesses face rising costs and intense competition, they are adapting for stronger international engagement, and sustained investment. They are not waiting for stability, they are building it, by investing in what matters most: Their people, their purpose, and their ability to adapt,” Kishan concluded. — TMR

Experts / Authors
Copy text of article