CARI Captures 381
ASEAN+3 Summit calls for collective efforts to maintain multilateralism
(16 November 2018) The 21st ASEAN Plus Three Summit which hosts ASEAN Member States plus China, Japan and South Korea alongside the 33rd ASEAN Summit concluded with a clarion call for cooperation in maintaining an open, rules-based and inclusive global trade environment for all members. Singaporean Prime Minister Lee Hsien Loong also called for the group to redouble its efforts to uphold multilateralism to tackle the region’s common challenges of growing trade tensions, digital revolution and cyber security. According to the prime minister, trade between ASEAN and the three countries totaled over US$800 billion in 2017, accounting for 31% of ASEAN’s trade volume last year.
East Asia Summit members to deepen cooperation
(16 November 2018) ASEAN Member States and eight of their key partners acceded to heighten cooperation in a range of security areas at the East Asia Summit (EAS). EAS members agreed to step up cooperation to address the issue of returning foreign fighters, boost cybersecurity, as well as ensure the safe and secure use, storage and transport of nuclear and other radioactive materials. Further, members agreed to advance the ASEAN Smart Cities Network, a partnership to weather rapid urbanisation and harvest opportunities presented by the digital revolution for the benefit of ASEAN citizens. The 18-country EAS also agreed to collaborate on the management of plastic waste, research and education on marine plastic debris, and enhancing cooperation in policy reform and law enforcement.
New MOU to boost ASEAN-Russia trade
(15 November 2018) Trade between ASEAN and member states of the Eurasian Economic Union (EAEU) which amounted to US$35.7 billion in 2017, is expected to increase following the signing of a new agreement to boost trade and investment at the ASEAN-Russia Summit on November 14. The memorandum of understanding (MOU) signed between ASEAN and the Eurasian Economic Commission reinforces the two blocs’ commitment to cooperate in areas such as customs procedures and trade facilitation, sanitary and phytosanitary measures, technical regulations, e-commerce, trade in services and investment, as well as business development. Russian President Vladimir Putin also noted that trade between Russia and ASEAN increased by 35% in the past year and said that Russia will participate in the ASEAN Smart Cities Network.
ASEAN bankers gear up for digital revolution
(20 November 2018) ASEAN bankers discussed ways to prepare for the fourth industrial revolution (4IR) at the 48th ASEAN Banking Council Meeting held in Brunei recently. According to ASEAN Bankers Association (ABA) chairman Phoukhong Chanthachack, the industry should look to leverage on the potential of the 4IR and endeavour to ensure sustainable economic management. According to the chairman, the new banking frontier is one of the five strategic pillars in the ASEAN Connectivity Master Plan and is estimated to be worth up to US$625 billion by 2030, accounting for 8% of ASEAN’s GDP in that year. ABA committees also endorsed proposals to promote sustainable and responsible financing, conduct information sharing on green bond financing and keep abreast of how 4IR will affect the banking sector.
Southeast Asia’s digital economy to exceed US$240 billion by 2025
(19 November 2018) Southeast Asia’s internet economy is expected to triple to US$240 billion by 2025 as affordable mobile internet drives rapid growth in sectors such as e-commerce, ride-hailing, online media and online travel, according to a new Google-Temasek report. The region’s internet economy is predicted to be valued at around US$72 billion at the end of 2018—up 37% from 2017—as measured by gross merchandise value. Indonesia is the largest and fastest-growing economy in the region, with an estimated value of US$100 billion by 2025 and accounting for 40% of the region’s spending. According to Google, 90% of internet users in Southeast Asia access the world wide web via smartphones and the six countries studied (Malaysia, Singapore, Indonesia, Philippines, Vietnam, Thailand) have around 350 million internet users today compared to only 260 million in 2015, making Southeast Asia among the fastest growing internet regions in the world.
Southeast Asian countries to benefit from US-China trade war
(21 November 2018) Analysts are bullish on Southeast Asia’s trade prospects as companies in the US and China push for import substitution towards the rest of Asia. Vietnam is deemed to be the clear winner with companies shifting production from China. Thailand’s automotive industry is a possible beneficiary as it is already Southeast Asia’s largest car manufacturer. Malaysia will likely benefit from electronic integrated circuits, liquefied natural gas and communication apparatus. According to the report by Nomura, of the 13 countries in its analysis, Bangladesh, India and South Korea are the least likely to gain from import substitution, while Pakistan will benefit least from the diversion of production and FDI.
President Xi Jinping’s Philippine visit yields 29 new collaborative initiatives
(21 November 2018) Twenty-nine new agreements were inked during Chinese President Xi Jinping’s two-day state visit to the Philippines. Among them were a framework agreement for joint oil and gas exploration in the South China Sea, US$2 billion to convert part of a former US air base in Manila into an industrial park and a loan for a railway across the island of Luzon. These agreements build on US$24 billion worth of investment pledges made two years ago when President Rodrigo Duterte visited Beijing. At a joint briefing, the Chinese leader said that China and the Philippines will manage contentious issues in the South China Sea and work with other ASEAN countries to solidify a code of conduct in the disputed waters.
Vietnam, India aim for US$15 billion bilateral trade volume by 2020
(19 November 2018) Vietnam and India are on course to reach their targeted two-way trade revenue of US$15 billion by 2020. India is one of Vietnam’s 10 largest trading partners and bilateral trade revenue between the two countries increased from US$7.8 billion (2015-2016) to US$12.8 billion (2017-2018). Deputy Prime Minister Trinh Dinh Dung invited Indian businesses to invest Vietnam particularly in its renewable energy, manufacturing, information technology and infrastructure development sectors. Indian President Ram Nath Kovind affirmed Vietnam’s importance to India and called on businesses from both countries to enhance cooperation in trade, technology and investments.
Free trade and Asia’s logistics resurgence
(21 November 2018) During the recent Asian Logistics and Maritime Conference, Hong Kong Chief Executive Carrie Lam emphasized the importance of free trade and attributed the state’s success as a leading international financial and logistics hub to the immutable value of free enterprise. Hong Kong’s free trade and related investment agreement with ASEAN is expected to take effect from January 2019. ASEAN Secretary-General Dato Lim Jock Hoi highlighted the need for more investment in the transportation sector as the region needed to expand its ports, highways and rail networks in order to provide greater regional and global connectivity. The digitization of supply chains was also discussed, with the Blockchain in Transport Alliance (BiTA)—an alliance with a membership of over 450 companies—pushing for industry-wide blockchain standards to ensure data interoperability and a common framework to help secure information across complex supply chains.
Tencent eyes Southeast Asia market as China tighten regulations on PC and mobile games
(19 November 2018) According to a report obtained by DealStreetAsia, Southeast Asia is the fastest growing market globally for PC and mobile games with industry revenue projected to reach US$2 billion by 2021. The number of PC online gamers is also projected to rise to 163 million by 2021 due to the growing popularity of e-sports. The region has attracted Chinese internet giant Tencent following its slowest quarterly growth in over three years due to the Chinese government’s regulation overhaul to tackle gaming addiction among youth. Tencent and Southeast Asian internet firm Sea Ltd’s entertainment arm Garena inked a five-year agreement to publish and distribute Tencent’s mobile and PC games in Indonesia, Taiwan, Thailand, Malaysia, Singapore and the Philippines.