The Hidden Giants: How Private Companies Drive the Global Economy

Private companies are often overshadowed by their publicly traded counterparts, yet they form the backbone of the global economy.

From small family-owned businesses to large privately held corporations, these entities drive innovation, create jobs, and contribute significantly to economic growth. They are the unsung heroes of the global economy, and their impact is particularly profound in Asia, especially in dynamic hubs like Hong Kong and Singapore.

These enterprises drive innovation, create employment opportunities, and significantly contribute to economic growth.

In the United States, private companies play a pivotal role in economic development. Collectively, they employ more individuals and engage in a broader range of economic activities than public companies. For instance, the 200 largest private companies in the U.S. had an average revenue of $7.89 billion and employed approximately 17,474 individuals in 2022. cato.org

Moreover, private equity-backed businesses alone employ around 12 million people, with employee earnings amounting to one trillion U.S. dollars. statista.com These figures underscore the substantial impact private companies have on employment and income generation. urban employment, and 90% of new jobs.

This trend is mirrored across Asia, where private companies, from burgeoning startups to established family-owned businesses, form the backbone of the economy.

Private companies are often more agile than their public counterparts, allowing them to innovate rapidly and respond to market changes. This agility fosters a competitive environment that benefits consumers through improved products and services. Private equity investment, in particular, can drive innovation within lower middle market companies by providing the financial backing and strategic support needed to invest in research and development. claconnect.com

Beyond their economic contributions, private companies strengthen communities across the nation. They generate $1.7 trillion in personal income, helping families manage expenses and plan for a secure future. On average, they contribute about 10% to states' GDP, supporting local businesses, investing in communities, and keeping Main Streets vibrant. uschamber.com

Private companies are the engine of Asia’s dynamic economic growth. In China, for example, private firms contribute around 60% of GDP, generate roughly 70% of the nation’s innovative capacity, employ about 80% of urban workers, and create nearly 90% of new jobs hks.harvard.edu. Similarly, in many developing Asian economies, small and medium-sized enterprises (SMEs)—which are predominantly private—comprise 97–99% of all business entities and provide between 50% and 80% of total employment Applied Economics. In markets like India and across Southeast Asia, private companies not only drive domestic consumption and services but also underpin manufacturing, innovation, and export-led growth, making them essential to the region’s overall economic resilience and long-term development.

In China, private firms are pivotal, accounting for approximately 60% of the nation's GDP, 70% of its innovative capacity, 80% of urban employment, and 90% of new jobs. source: hks.harvard.edu

China’s lesser‐known, yet globally competitive, private companies—often small or medium‐sized enterprises (SMEs) that have grown into hidden champions in their respective niches. These companies typically operate in high‐tech, specialized fields such as advanced manufacturing, electric vehicles, renewable energy, robotics, and semiconductor components. Despite not being household names like Alibaba or Tencent, they drive a disproportionate share of innovation, productivity, and export performance in China.

For example, companies like BYD in electric vehicles and Longi Green Energy Technology in solar panels have emerged as dominant players in their sectors. BYD not only leads in producing electric vehicles but also plays a critical role in building the domestic supply chain for batteries and components, helping to upgrade China’s manufacturing base. Similarly, Longi—though less visible to the general public—has become a global leader in solar panel technology and advanced materials, contributing significantly to the country’s export revenue and technological self-reliance.

In Hong Kong, the hidden champions refer to local businesses that have achieved significant success in specialized niche markets, often operating under the radar of mainstream recognition. These companies are typically family-run and exhibit a strong commitment to innovation, continuous improvement, and long-term goals. They focus on serving specific market segments with a global reach, setting them apart from other medium-sized firms. researchdb.hsu.edu.hk

In Hong Kong, the construction industry is a significant contributor to the economy, with private construction companies playing a pivotal role. In 2023, the gross value of construction works (GVCW) performed at private sector sites totaled HK$85.0 billion, marking a 27.0% increase in nominal terms from the previous year. Besides, in Hong Kong's private real estate sector, several companies have established themselves as "hidden giants" by excelling in specialized markets and contributing significantly to the economy.  censtatd.gov.hk

For examples, companies like Hongkong Land, contribute to Hong Kong's economy by driving innovation in property development. By anticipating raising $6 billion through divestments, Hongkong Land aims to double its underlying profit and grow managed assets to $100 billion by 2035. This strategic shift underscores the company's adaptability and its significant role in the region's real estate market.  reuters.com

Similarly, beyond its well-known developments from Sun Hung Kai Properties, SHKP has a subsidiary, Sanfield (Management) Limited, which specializes in construction project management. Established in 1974, Sanfield has been instrumental in delivering high-quality residential and commercial projects across Hong Kong.  inriskable.com

While Singapore is best known for its global banks, conglomerates, and multinational headquarters, a number of smaller, niche-focused firms have quietly built world‐class competencies in specialized areas such as advanced manufacturing, biotech, and high-technology services.

For example, several technology and manufacturing companies in Singapore have achieved global leadership in their fields despite not being household names. In the semiconductor equipment and precision engineering sectors, companies such as ST Engineering Electronics and Venture Corporation (which started as a humble local outfit) now compete internationally by providing specialized components and services. These firms not only drive exports and innovation but also help strengthen Singapore’s overall industrial base by supporting supply chains, fostering high-value R&D, and creating highly skilled jobs.

Despite their significant contributions, the growth of privately held businesses has raised concerns among regulators and policymakers about financial transparency. The lack of publicly available information can make it challenging to assess the financial health and risks associated with these entities. chicagobooth.edu

Private companies are indeed the hidden giants of the global economy. Their contributions to economic growth, innovation, and community development are invaluable. Recognizing and supporting these enterprises is crucial for sustained economic prosperity.