ASEAN Business Complexity Index 2025

ASEAN business complexity in 2025: Indonesia struggles, Malaysia slips, Singapore trails Vietnam and Thailand

What the index measures and how to read it

TMF Group’s Global Business Complexity Index (GBCI) ranks 79 jurisdictions on how hard it is to set up and run a company. Rank 1 means most complex. Rank 79 means least complex. The study tracks 292 indicators across legislation, compliance, accounting, tax, human resources, and payroll. In Asia Pacific, the 2025 table places New Zealand at 77, Hong Kong at 76, Thailand at 56, Vietnam at 54, Taiwan at 51, and Singapore at 48. In simple terms, a lower number is more complex, and a higher number is better for ease of doing business. Keep that scoreboard in mind as we focus only on the ASEAN countries in the list.

Indonesia is the most complex in Southeast Asia

Among ASEAN markets, Indonesia remains the most demanding environment operationally. Companies face overlapping permits, multi-agency filings, Indonesian language documentation, local content rules, and frequent regulatory updates. The 2020 Omnibus Law helped in specific areas, but practical hurdles persist. Provincial interpretations can differ, payroll and tax settings are updated often, and some sector caps still complicate investment structures. For operators, that translates into longer lead times, larger advisory budgets, and a heavier execution risk premium. In 2025 Indonesia is the hardest ASEAN market for day-to-day corporate administration.

Malaysia is second worst, and it has slipped since 2022

Malaysia follows Indonesia as the second most complex ASEAN market this year, and its relative position has deteriorated since 2022. On paper, Malaysia has strong infrastructure, widespread digital filing, and accounting standards aligned with IFRS. In practice, the compliance load has increased. Anti money laundering and beneficial ownership checks now demand more documentation and ongoing monitoring. Sector specific licensing adds layers at market entry and expansion.

Most important for controllers, taxation is messy and keeps changing. Scope changes, rate tweaks, clarifications, and transitional rules have been frequent. Finance teams must rework processes, adjust systems, and redo training more often than before. That is why Malaysia’s rank has drifted toward the complex end of the table compared with ASEAN peers.

Singapore now ranks behind Vietnam and Thailand

Singapore sits at 48th in the GBCI. It is still easier than many global markets, but in 2025 it trails Vietnam and Thailand among ASEAN peers. The reasons are straightforward. Singapore enforces high standards for anti-money laundering, data governance, and financial supervision. Those safeguards protect system integrity, and they add steps and documentation for businesses. Immigration rules and employment pass requirements can also slow hiring in talent constrained sectors. None of this makes Singapore unfriendly to business. It does explain why, in a ranking that rewards frictionless execution, Singapore currently sits behind Vietnam at 54 and Thailand at 56.

Vietnam leads Southeast Asia in 2025

Vietnam is the least complex operating environment among the ASEAN markets covered this year. The improvement comes from clearer incorporation pathways, better digital access to official guidance, and more predictable calendars for payroll and tax. For companies building a China plus one production footprint, these procedural gains make Vietnam a credible base. Execution still requires care, especially with local documentation and licensing, but the mechanics of incorporation and ongoing compliance are more manageable than in prior cycles.

The Philippines is mid table with improving capabilities

The Philippines lands in the middle of the ASEAN pack. Businesses still encounter sticky bureaucracy and uneven local implementation. At the same time, human resources and payroll processes have improved, and digital government services have expanded. Onboarding can take longer than investors prefer, yet routine operations tend to stabilize once workflows, calendars, and service partners are in place.

Why Indonesia performs worst, and Malaysia second worst

Indonesia’s pain points cluster around permits, local content, sector caps, and policy churn. Payroll and tax rules often vary or update at a pace that stretches internal teams. Malaysia’s challenges are different. Strong infrastructure and clear accounting rules coexist with frequent tax changes, tighter beneficial ownership tracing, enhanced KYC, and sectoral licensing. Both markets require experienced company secretaries, payroll specialists, and tax advisers to keep filings clean and on time. In the ASEAN context, that is why Indonesia ranks as most complex and Malaysia follows as second most complex in 2025.

How ASEAN investors should use the table

• Lower rank number means more complex and implies higher administrative cost and longer timelines.

• Higher rank number means less complex and implies faster setups and simpler maintenance.

• In 2025, Vietnam and Thailand score better within ASEAN, Singapore is still competitive but now sits behind those two, Malaysia has grown more complex since 2022 with a messy and changing tax environment, and Indonesia remains the heaviest lift for process work.

Bottom line for SBP readers

If you want speed and procedural certainty in ASEAN, consider Vietnam, Thailand, and Singapore, in that order for operational simplicity this year. Vietnam’s streamlined mechanics and Thailand’s steady predictability reduce friction for controllers. Singapore offers a high trust legal environment and world class infrastructure, with added time and documentation for AML, data, and immigration compliance. Malaysia brings depth and talent but has become more complex since 2022, and tax rules that change frequently add real work for finance teams. Indonesia still offers scale and opportunity, but you should budget for the most demanding compliance journey in the ASEAN region.

Plan timelines with buffers, build finance and legal capacity early, and choose local partners who live inside the GBCI’s moving parts. That is how ASEAN complexity becomes a known and manageable cost rather than a costly surprise.