CARI Captures Issue 727: Private funding for ASEAN’s digital economy lags global growth rate

VIET NAM
Auto sales rise by 24% month-on-month in October 2025
(13 November 2025) Vietnam Automobile Manufacturers Association (VAMA) members sold 37,910 vehicles in October, a 24% month-on-month increase driven by stronger consumer demand, improved supply, and year-end promotional programmes. The sale of passenger cars rose 33% to 27,246 units, while those of commercial vehicles rose 6.6% to 10,162 units, and those of special-purpose vehicles declined by 15% to 502 units. Sales of locally assembled vehicles increased 19% to 17,129 units, while completely built-up imports rose 28% to 20,781 units, reinforcing the popularity of SUVs, sedans, and MPVs. Experts cited aggressive promotions, better supply chains, eased consumer credit, lower interest rates, rising urban demand, and the rollout of new Japanese, Korean, Chinese, and European models as key drivers. For the first ten months, VAMA members recorded 289,331 units sold, up 9.5% year-on-year, with domestic assembly up 2% and imports up 18%, signalling stronger demand for imported vehicles with broader design and technology options. VAMA data, however, exclude major brands such as VinFast and Hyundai. VinFast delivered a record 20,380 electric vehicles in October and 124,264 units in the first ten months of 2025, marking the highest-ever volume for a Vietnamese automaker and reinforcing its position in the domestic EV segment.

THAILAND
Government offering domestic travellers tax deductions of up to THB 30,000
(11 November 2025) Thailand’s government is offering domestic travellers tax deductions of up to THB 30,000 between 29 October and 15 December to stimulate the economy and support second-tier provinces such as Trang, but local businesses report limited impact due to the short programme window, weak economic conditions, and high household debt. Trang operators cite muted demand, with November–December reservations down about 50% year-on-year, despite 1.3 million Thai visitors in the first nine months of 2025 generating THB 6.7 billion in revenue. Hotel and tour operators note slow business onboarding into the deduction scheme and limited appeal among lower-income travellers who fall outside taxable brackets. The tax incentive forms part of broader government measures, including a THB 60 billion plan to purchase bad debt benefiting two million borrowers and efforts to attract more Chinese tourists. Bank of Thailand economists estimate that second-tier provinces account for about 13% of national tourism income, but the weak economic environment, recent flooding, and tensions from the Thai-Cambodian military clash are weighing on domestic travel sentiment. In Ubon Ratchathani, officials expect hotel occupancy to remain below 40% in the final two months of 2025. Restaurants are seen as the likely beneficiaries of the rebate, which can also be used for food purchases without travel.

THAILAND
BOI approves first phase of FastPass system to accelerate permit and approval processing times
(10 November 2025) The Thai Board of Investment (BOI) approved the first phase of its FastPass system on 10 November 2025, aiming to accelerate “Quick Big Win” investments by integrating seven key agencies — BOI, Department of Industrial Works, IEAT, ONEP, Immigration Bureau, Department of Employment and the EEC Office — to cut permit and approval processing times by 20%–50%. A new Investment Acceleration Subcommittee will oversee implementation and expand FastPass to cover all major business licensing procedures. The BOI meeting also reviewed progress on resolving three structural bottlenecks: electricity supply, where the Energy Regulatory Commission is fast-tracking a network usage guarantee mechanism and plans to finalise UGT2 and Direct PPA criteria and fees by end-2025; land provision, where the Department of Public Works, EEC and IEAT are revising town planning, expediting industrial land EIAs and addressing public thoroughfare issues; and visas and work permits, where e-Visa processing for BOI-approved personnel will be shortened to 1–5 working days, OSS Centre capacity will increase from 200 to 500 queues per day, and technical integration issues in the e-Work Permit system are being resolved.

MALAYSIA
GDP grows 5.2% year-on-year in third quarter of 2025, fastest pace in four quarters
(14 November 2025) Malaysia’s GDP grew 5.2% year-on-year in the third quarter, up from 4.4% in the previous quarter and the fastest pace in four quarters, supported by sustained domestic demand and higher net exports, according to Bank Negara Malaysia’s quarterly report. Services expanded 5.0%, driven by wholesale and retail trade, transportation, food and beverages, and accommodation, while manufacturing grew 4.1% on stronger output in electrical, electronic, and optical products, food processing, and non-metallic mineral and metal subsectors. Mining and quarrying rebounded 9.7% after a 5.2% contraction in the second quarter due to higher natural gas and crude oil production, and construction recorded 11.8% growth, led by civil engineering, specialised construction, and non-residential building activity. The central bank maintained its policy rate this month after cutting it from 3% to 2.75% in July to mitigate external risks and trade uncertainties. Government forecasts place GDP growth at 4%–4.8% in 2025 and 4%–4.5% in 2026, compared with 5.1% in 2024, while the World Bank projects 4.1% growth in both 2025 and 2026 amid expectations of slower medium-term momentum.

INDONESIA
Indonesia plans to commercialise palm oil-derived aviation fuel within two to three years
(14 November 2025) Indonesia is testing palm oil–derived sustainable aviation fuels (SAF) with plans to commercialise them within two to three years, part of a broader effort to reduce energy imports, expand biodiesel use, and increase value-added activities in the palm oil sector. Pertamina is conducting SAF trials with Pelita Air, Garuda Indonesia, and Citilink, claiming potential emissions reductions of up to 84%, with its Cilacap refinery able to produce about 238,000 kilolitres annually and another refinery in South Sumatra able to shift capacity if needed. Current tests involve used cooking oil and palm oil mill effluent after earlier palm kernel oil–based attempts proved too costly. Garuda has trialled palm oil–based jet fuel on Jakarta–Amsterdam flights with stable results, while Airbus Indonesia noted SAF’s compatibility with existing aircraft and airport infrastructure. The government is seeking investment from Danantara, the sovereign wealth fund, to scale SAF production. In parallel, Indonesia plans to raise its biodiesel mandate from 40% to 50% next year, with B50 road tests scheduled for December across six sectors, though officials acknowledge challenges from stagnant palm oil output. To address supply constraints, the Ministry of Agriculture aims to open 600,000 hectares of new oil palm plantations starting next year.

MALAYSIA
Malaysia, Singapore, and Indonesia mull trilateral cooperation under JS-SEZ
(13 November 2025) Malaysia, Singapore, and Indonesia have begun preliminary discussions on potential trilateral cooperation under the Johor-Singapore Special Economic Zone (JS-SEZ), with Malaysia’s Investment, Trade, and Industry Minister stating that senior officials from all three countries will conduct a detailed study following talks held with Singapore’s Deputy Prime Minister and Indonesia’s Coordinating Minister for Economic Affairs at the ASEAN Summit. The exploration marks the first comprehensive assessment of a concept previously raised but not formally evaluated. Malaysia’s Investment, Trade, and Industry Minister said the JS-SEZ is progressing well and that a tripartite expansion could offer additional benefits, though formal engagement will depend on the study’s findings. Singapore’s Deputy Prime Minister earlier disclosed that Singapore is considering collaboration involving both the JS-SEZ and Indonesia’s Batam, Bintan, and Karimun (BBK) region, where Singapore is a major investor. The JS-SEZ currently spans around 357,128 hectares across Iskandar Malaysia, Forest City, the Pengerang Integrated Petroleum Complex, and Desaru.