ASEAN
The First ASEAN Digital Ministers Meeting (ADGMIN1) aims to strengthen cooperation between ASEAN countries
(20 January) The first ASEAN Digital Senior Officials Meeting (ADGSOM1) convened in Kuala Lumpur on 20 January 2021. Among the agendas discussed in the two-day meeting are the ASEAN ICT Fund (AICTF), the ASEAN Digital Master Plan 2025 (ADM 2025), the implementation of the 2020 work cycle activities and its presentation as well as the report of the first ASEAN Cyber ​​Security Coordination Committee meeting. ASEAN digital senior officials met with their dialogue partners from the US, China, Japan, South Korea, India, European Union (EU) and the International Telecommunications Union (ITU). ASEAN member states need to strengthen their connectivity and move as one bloc in accelerating digitalisation in the region, especially during the COVID-19 pandemic. The meeting will then proceed to the ministerial level ASEAN Digital Ministers Meeting (ADGMIN1) on 21 January 2021.

MALAYSIA
Growth forecast for Malaysia lowered to 1%-3% amidst state of emergency and lockdown.
(13 January 2020) Several economists slashed their 2021 growth forecasts for Malaysia after the country announced stricter measures to contain a recent surge in COVID-19 cases. Alex Holmes, Asia economist at Capital Economics, pointed out that the six states and territories under lockdown, which include capital city Kuala Lumpur and Malaysia’s richest state, Selangor, account for 57% of the population and 65% of gross domestic product. Economists from UOB said in a 20 January report that their growth forecast downgrade to 5% assumed that the restrictions are extended for another four weeks until end-February.  The state of emergency declared on 19 January rocked the country’s stocks and currency, but the move will remove near-term political uncertainty that the country has struggled with in the past year and that could be “a blessing in disguise” for the Malaysian ringgit, said Lavanya Venkateswaran, market economist at Mizuho.

MALAYSIA
Malaysia Aviation Group (MAG) gets nod to move forward with restructuring exercise
(20 January 2020) Malaysia Aviation Group (MAG), the parent company of Malaysia Airlines, today obtained approval from the UK Court to proceed with a major component of the debt restructuring of the Group, following the severe impact of the COVID-19 pandemic on the global travel and tourism industry. The statement added that MAG has since been in active discussions with all its stakeholders and has managed to obtain overwhelming support to carry out its restructuring after many rounds of negotiations. However, it added that there remains a minority of creditors that have yet to indicate their support for the restructuring. “Therefore, part of the restructuring is being implemented by means of a scheme of  arrangement to be proposed by its aircraft leasing subsidiary, MAB Leasing Limited,” MAG said. Daily operations and activities of Malaysia Airlines, and all subsidiaries under MAG will not be impacted by the ongoing restructuring. The outcome of the creditor meeting will be reported back to the Court at the sanction hearing on 22 February. It is expected that the UK Court process and the wider Group restructuring exercise will conclude by the end of Q1 2021.

SINGAPORE
Business investments into Singapore rise to 13%, the highest in over a decade
(20 January 2021) Business investment commitments into Singapore rose 13% in 2020 to their highest in more than a decade, helped by sectors such as semiconductors, energy and chemicals even as the city-state suffered its worst recession from the COVID-19 pandemic. Commitments for investments in fixed assets such as facilities, machinery and other equipment swelled to US$13 billion (S$17.2 billion) in 2020, while commitments by total business expenditure, whose major components include wages and rental, fell 24% to S$6.8 billion. Still, Singapore bagged some major wins in 2020, with China’s Tencent, Zoom Video Communications Inc and TikTok owner ByteDance planning major expansions in the city-state. The Economic Development Board (EDB), however, cautioned that investments in fixed assets for 2021 may not reach the levels of 2020.

INDONESIA, SINGAPORE
Southeast Asia’s and Singapore’s biggest tech startup, Sea Group, now fully controls the Indonesia’s PT Bank Kesejahteraan Ekonomi (Bank BKE)
(20 January 2021) Recent moves by tech firms to acquire small Indonesian banks will add more colour to ASEAN’s financing landscape, but are unlikely to pose a material challenge to the biggest incumbent lenders in the near term, said Fitch Ratings. In the past two months, there had been separate reports on consumer Internet firm Sea Group planning to acquire Bank Kesejahteraan Ekonomi (BKE) and mulling over the purchase of another Indonesian bank. While Sea Group secured a full digital banking licence in Singapore last month, it will still need approval from the Indonesian financial service regulator to wholly acquire BKE due to limits on foreign ownership. Indonesia’s Gojek is also increasing its stake in Bank Jago. This highlights the ambition of tech firms to make further inroads in financial services, said Fitch.  Analysts had said that Indonesia and the Philippines provide the largest market potential among Asean’s six major economies for digital banks, on the back of their large unbanked population and low levels of household leverage. The six are Singapore, Malaysia, Thailand, the Philippines, Indonesia and Vietnam.

VIETNAM
Shopee is Vietnam’s most-visited e-commerce site, followed by Mobile World, Tiki and Alibaba’s Lazada.
(20 January 2021) According to data from iPrice Group, Shopee was the most-visited site in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam in the third quarter of 2020. Only a year earlier, Lazada (owned since 2016 by China’s Alibaba Group Holding) was number one in the Philippines, Singapore and Thailand, while Indonesia’s most-visited site was Tokopedia, the e-commerce group backed by Japan’s SoftBank Group. Shopee, owned by Singapore-based tech group Sea, received 62 million monthly visits in Vietnam in the third quarter of 2020, up more than 80% from a year earlier. Shopee’s bullish expansion in Vietnam is part of a new phase of development in Southeast Asia’s US$100 billion digital economy. Shopee is now far outperforming its rivals in the country. Next is the Gioi Di Dong, also known as Mobile World, which had 29 million monthly visits during the same period. Tiki, a local e-commerce operator, followed with 22 million , and Lazada had 20 million, according to iPrice data.

BRUNEI
Brunei government identifies six priority sectors for growth in a 15-year economic blueprint.
(15 January 2021) Brunei’s  Ministry of Finance and Economy launched the Brunei Economic Blueprint, which provides guidelines for the country to achieve the third goal of the Brunei Vision 2035 strategy, thus developing a dynamic and sustainable economy. The country aims to diversify its economy away from oil and gas, which contributes to 95% of export earnings, transforming the small nation on the island of Borneo into the fifth richest nation in the world with a GDP per capita of US$61,000 based on PPP in 2020.