Five Trends Shaping South East Asia’s Financial Landscape

A blog by Yiow Chong Tan, Director – South East Asia.

26 November 2025

South East Asia’s economies continue to show steady growth and resilience despite global uncertainty. In the second quarter of 2025, Malaysia’s GDP held steady at 4.4% year-on-year, while Singapore’s economy grew 4.4%, up from 4.1% in the first quarter (McKinsey & Company). From the growth of Islamic finance and the increasing focus on sustainability to the expansion of regional fund management and private wealth, the region is strengthening its position as a centre for innovation and investment.

Through my engagements and conversations with intermediaries in Malaysia and Singapore this year, I’ve personally seen five key trends shaping the market and how Jersey can play a role in supporting cross-border investment.

1. Malaysia drives the globalisation of Islamic finance

Malaysia remains one of the world’s most advanced Islamic finance markets, with the sector accounting for more than 46% of Malaysia’s total financing in 2024. Its leadership extends across Shari’a-compliant investments, digital assets and Sukuk issuance. Halogen Capital’s launch of the world’s first three Shari’a-compliant crypto funds is one example of how Malaysia continues to drive innovation in this space.

Malaysian investors are also increasingly using international structures to access global markets. The Malaysian Pilgrimage Fund, Lembaga Tabung Haji, for example, holds UK commercial real estate through Jersey-based entities, including notable properties such as Great Minster House in London. In my conversations with Malaysian financial institutions, I’ve noticed a growing comfort with using Jersey structures to access global markets.

I’m often asked why South East Asian investors choose Jersey. From my perspective, it comes down to Jersey’s six decades of experience and its deep-rooted expertise in Islamic finance, with its ability to support complex Shari’a-compliant transactions, including Sukuk, that make it an ideal jurisdiction for regional investors. As Malaysian institutions continue to expand internationally, Jersey offers a well-regulated and cost-efficient platform for structuring and managing cross-border investments.

2. ESG and Shari’a principles are becoming more closely aligned

Environmental, social, and governance (ESG) considerations continue to move into the mainstream across South East Asia. Governments are driving the agenda with initiatives such as Singapore’s Green Plan 2030, which targets net-zero emissions by 2050, and Malaysia’s New Industrial Master Plan 2030, which aims to decarbonise industries through energy efficiency, renewable energy adoption and regulatory frameworks. The adoption of ESG practises is clear in the private sector too, with the introduction of Wealth Management Institute’s Applied ESG Investment certificates, designed for family office professionals and advisers, as well as asset managers and private bankers.

Regional investors are increasingly integrating sustainability into their investment strategies, reflecting the rising priority of ESG across both public and private sectors.
Yiow Chong TanDirector – South East Asia, Jersey Finance

I saw this firsthand during discussions at an event in Singapore earlier this year, held in partnership with NatWest Markets Singapore, Circle Capital and Fidinam Group Worldwide.

There is also a growing recognition that Shari’a principles and ESG objectives share many similarities. This topic was clearly covered at the session I moderated at the IFN Investor Forum in Kuala Lumpur, where advisers from the region spoke about how Islamic investors are increasingly contributing to wider sustainability goals, creating both financial and social value.

As a leading IFC, Jersey has been active in this area for some time, and with a sustainable finance strategy to catalyse action and initiatives are well placed to support the inclusion of sustainable finance across all the different sectors of financial services.

3. Fund managers are seeking efficient routes for cross-border investment

As South East Asia’s funds sector grows more managers in Singapore and Malaysia are setting up structures that give them access to global investors and asset classes.

Fund managers in Singapore and Malaysia are increasingly looking for jurisdictions that offer regulatory familiarity, tax efficiency and strong links to major markets. This trend came through clearly during the ‘Funds Foundations: Choosing the Right Jurisdiction’ event in Singapore last May, which I co-hosted with KPMG and Zedra.

From my discussions with managers, it’s clear that managers value jurisdictions that make it easier to reach European investors, which is where Jersey’s framework really stands out. The double tax treaty between Singapore and Jersey, together with Jersey’s National Private Placement Regime, makes it a practical and cost-effective choice for funds targeting European investors.

What’s attractive to South East Asian managers are Jersey’s fund structures, including the Jersey Private Fund (JPF), which are well suited to regional managers investing in private equity, venture capital and real estate, offering flexibility, speed to market and high regulatory standards – qualities that appeal to both managers and their institutional investors.

4. Family offices are expanding and looking for trusted partners

Malaysia’s new Single Family Office Tax Incentive Scheme, introduced in 2024, has generated strong interest from high-net worth families both within the region and globally. According to local intermediaries I’ve spoken to, there is already a waiting list of applications.

Although the scheme is similar to Singapore’s 13O family office incentive, Malaysia’s version offers certain advantages, including a longer initial 10-year tenure, renewable for another decade if specific conditions are met.

We discussed how Jersey’s long-established private wealth services can be complemented by this new framework at July’s private wealth roundtable in Kuala Lumpur, hosted in partnership with LHAG LLP. Advantages such as the experience in trust and foundation administration found in Jersey, our well-regulated structures for wealth preservation and succession planning, and the ability to support intergenerational transfers make Jersey an attractive partner for South East Asian families seeking international diversification and transparency.

5. Real assets remain central to institutional investment strategies

Institutional investors in the region continue to allocate significant capital to tangible assets, particularly real estate. Malaysia’s shift from traditional industries to technology, green energy and infrastructure has also opened new opportunities for foreign investment.

Investors from the US, China, Singapore and Europe are showing growing interest in Malaysia’s evolving real asset landscape, a trend that was explored during a funds roundtable I co-hosted in Kuala Lumpur last July with Spartan Ives Capital.

Many of Malaysia’s largest institutional investors – including sovereign wealth and pension funds – already use Jersey vehicles to hold UK real estate. Examples include landmark projects such as London’s Battersea Power Station and Brabazon in Bristol, where Malaysian investors including EPF, Sime Darby, SP Setia and YTL have invested through Jersey SPVs. These developments reflect both Malaysia’s global investment outlook and Jersey’s established role as a bridge between South East Asian capital and UK opportunities.

From my experience working with investors using Jersey structures, I’ve seen how its expertise in fund and real estate structuring provides real value for managing cross-border investments.

Looking Ahead

Across Islamic finance, ESG, funds, private wealth and real assets, the same pattern is clear: South East Asian investors are becoming increasingly global in their outlook. They’re looking for stable, well-regulated jurisdictions that offer efficiency, expertise and strong international connections.

Jersey’s long history in supporting cross-border investment, combined with its close relationship with the UK and Europe, makes it an ideal jurisdiction partner for the region. As markets continue to evolve, Jersey Finance remains committed to working with investors, regulators and intermediaries across South East Asia to build lasting connections and support sustainable growth.

To find out more about our plans for next year, please get in touch.

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