Japan's M&A market reached unprecedented levels in 2025, with 3,472 transactions totalling US$218.5 billion – an 83.9% increase in deal value compared to 2024. Sanae Takaichi became the LDP's first female leader and Japan's first female Prime Minister, signalling a focus on economic growth and lifting defence spending to 2% of GDP.

Japanese investment in Australia reached record levels for the third consecutive year, with Australia continuing to be seen as a safe-haven environment. Real estate emerged as a priority sector, with growing appetite for planned communities, logistics and data centres, whilst energy security remains paramount.

Key 2026 opportunities: Real estate, critical minerals (with JBIC and JOGMEC mandate amendments), and defence collaboration following the A$55 billion Mogami-class frigate contract.

2025 was a consequential year for Korea, marked by President Lee Jae Myung's inauguration following a snap election, reshaping Seoul's foreign policy toward pragmatic diplomacy. Australia-Korea cross-border investment volumes increased 20% year-on-year in the first three quarters of 2025.

POSCO Holdings' A$1.2 billion investment into Mineral Resources' lithium assets represented a landmark in bilateral energy-transition cooperation, securing a 30% interest and long-term access to spodumene concentrate from Tier-1 assets at Wodgina and Mt Marion.

Korea's defence-industrial footprint expanded materially through Hanwha's strategic accumulation of shares in Austal Limited, with the Treasurer approving a stake increase to 19.9% in mid-December, positioning Hanwha as Austal's largest single shareholder.

Key 2026 opportunities: Continued critical minerals collaboration, defence-industrial projects, and traditional sector reorganisations.

2025 was another difficult year for China's domestic economy, albeit improved and more stabilised than 2024, with a record US$1.189 trillion trade surplus. China has reinvented itself with laser-focused policies supporting exports to offset reduced US exports, with continued surge in overseas manufacturing investment, particularly in Southeast Asia.

Following a solid re-election mandate, Australia charted its own independent China strategy, prioritising trade interests whilst maintaining security commitments. The Prime Minister made a clear statement with a week-long, three-city tour complete with business meetings.

Inbound M&A into Australia from Chinese companies remained subdued as the challenge of obtaining FIRB approval continued to impede deal activity.

Key 2026 opportunities: EVs and batteries continue to pour into Australia. Expect deals in mining, biotech, FMCG and fintech through minority equity interests, joint ventures and licensing agreements.

Prime Minister Lawrence Wong led the People's Action Party to a landslide victory at Singapore's 2025 General Election, bringing political certainty, though overall M&A activity slowed following US "Liberation Day" downdraughts.

The telecommunications sector saw its first attempt at consolidation with Simba Telecom announcing its proposed S$1.43 billion acquisition of M1 Limited. Healthcare M&A increased significantly, driven by Singapore's low fertility rate and ageing population.

Capital markets reform initiatives deployed approximately S$3.95 billion to local asset managers, whilst IPO fundraising reached its highest level since 2019 at approximately S$2.54 billion.

Key 2026 opportunities: Real estate remains hot with fresh funds from NTT DCC REIT and Centurion Accommodation REIT expected to fuel Australian deployment. Telecommunications sector expected to see increased activity.

Malaysia's dealmaking environment in 2025 was defined by solid GDP growth of 4.7–5.0%, driven by strong domestic demand and supportive interest rates. Malaysia positioned itself as a rare point of convergence for both Chinese and Western investors, emerging as the Australian Government's leading renewable-energy focus country in Southeast Asia.

Malaysian investment in Australia expanded significantly. Sime Darby Property acquired the largest Melbourne CBD development site in five years. Gamuda Berhad secured two major infrastructure contracts worth over RM8 billion and acquired its first portfolio of large-scale renewable energy projects in central Tasmania.

In January 2025, Fortescue agreed to invest in green hydrogen projects in Bintulu, Sarawak, highlighting growing Australia-Malaysia collaboration in renewable energy.

Key 2026 opportunities: Infrastructure, renewables and property sectors remain strong for Malaysian investment in Australia.