McKinsey: Southeast Asian Economies Slowed in Q1 2025

According to McKinsey & Company, Southeast Asia's economy recorded slower growth in Q1 2025 compared to the same period the previous year (year-on-year/yoy).

Based on Gross Domestic Product (GDP), practically only the Philippines showed a slight increase of 0.1% compared to the previous quarter.

The following are the real GDP growth rates of six Southeast Asian countries compiled by McKinsey in Q1 2025:

1. Vietnam: 6.9%
2. Philippines: 5.4%
3. Indonesia: 4.9%
4. Malaysia: 4.4%
5. Singapore: 3.9%
6. Thailand: 3.1%

"Vietnam remains the best-performing economy in the region, although it recorded its slowest growth in the last three quarters," wrote Albert Chang and Kamaruzaman Kamarudin in a McKinsey article on Tuesday (June 24, 2025).

According to Chang and Kamarudin, Malaysia and Singapore saw their year-on-year quarterly growth slow for the second consecutive quarter, while Indonesia remained below the government's target of 8%.

They also observed a weakening of core growth drivers in Southeast Asia. Exports, industrial activity, and investment showed signs of slowing in Q1 as market players became more cautious.

Countries in the region appear to be readjusting their growth expectations for 2025, given the increased market volatility.

"The Philippines and Singapore have revised down their growth targets for 2025, while Malaysia is expected to reveal new growth projections after the macroeconomic environment stabilizes," said Chang and Kamarudin.

(Read: Indonesia's Economic Growth Reaches 5.12% in the Second Quarter of 2025)