The rise of SOEs in Asia-Pacific

How state-owned enterprises are balancing national priorities with commercial discipline in 2026.

27 February 2026

4 mins

by:

Dieu Anh Khuat Executive Director, Capital Structure & Rating Advisory, ASEAN & South Asia

Capital structure and rating advisoryCorporate & investment banking

At the S&P Global Rating’s Asia-Pacific Corporate Outlook Virtual Conference 2026, Dieu Anh Khuat, Head of Capital Structure & Rating Advisory (ASEAN & South Asia), shared her perspectives on how state-owned enterprises (SOEs) across Asia-Pacific are evolving, and what this means for capital structure and financial policy.

From national asset operators to growth champions

Across Asia-Pacific, SOEs are playing a more proactive role in driving economic growth. Governments are increasingly leveraging them to execute major development projects and anchor strategic sectors.

Along with this expanded role is a push for SOEs to operate more like commercially-minded private sector companies with capital markets being central to this shift.

Asia is home to around 70 per cent of the world’s listed SOEs, representing 26 per cent of regional market capitalisation. Historically, some exchanges such as the Shanghai Stock Exchange were established to support SOE reform, fostering governance professionalisation and financial independence. Today, SOEs are not only accessing equity markets but also tapping domestic and offshore debt capital markets. Many have obtained international credit ratings to access global capital markets and broaden investor base.

The direction is clear: funding growth increasingly through markets rather than relying solely on state balance sheets.

A stronger focus on financial policy

From a capital structure perspective, Anh noted a shift in how SOEs frame their priorities.

The question is no longer simply “How do we fund growth?” but “What capital structure can sustainably support that growth?”

SOEs are evaluating liquidity buffers, leverage targets and financial policy frameworks in greater detail. For those with large funding needs and leverage pressures, resilience measures include diversifying the capital base through hybrid capital, monetising non-core assets and improving working capital efficiency.

Meanwhile, SOEs with excess liquidity are focusing on capital deployment, ensuring balance sheets remain productive rather than passive.

While SOEs retain national mandates, success is increasingly measured by private-sector standards: capital efficiency, funding diversification and credible financial policy framework.

Sovereign wealth funds as strategic enablers

Anh also highlighted the evolving role of sovereign wealth funds (SWFs).

New entities such as Indonesia’s Danantara, alongside established investors like Temasek, are reshaping how state capital is managed. Danantara combines oversight of SOEs with active capital deployment into priority sectors, aiming to unlock value and reinvest strategically.

Temasek operates as a commercial investor but retains the ability to provide stabilising capital when needed, as demonstrated during COVID-19 with the recapitalisation of Singapore Airlines.

Across Asia-Pacific, SWFs are becoming integral to SOE modernisation: providing capital, discipline and strategic direction in an era where SOEs are expected to do more with less direct government funding.

To hear the broader discussion, including additional country perspectives from S&P Global Ratings, watch the replay of the Asia-Pacific Corporate Outlook Virtual Conference 2026 webinar.

For corporates and SOEs seeking support on capital structure strategy and funding diversification, Standard Chartered’s Capital Structure & Rating Advisory team works alongside clients to navigate these evolving dynamics.