Captures has widened its scope to include news related to all the members of the Regional Comprehensive Economic Partnership (RCEP) agreement which was signed towards the end of 2020. Besides the ASEAN Member States, this includes Australia, New Zealand, China, Japan, and South Korea. The other weekly newsletters under CARI, China-ASEAN Monitor and Mekong Monitor will also be consolidated into the Captures newsletter. We hope this new version of Captures will serve you better and look forward to providing a curation of stories relevant to ASEAN and its trading partners.

THAILAND, LAO PDR
Thailand confirms four cases of anthrax, Lao PDR bans animal imports from Thailand
(07 May 2025) The Provincial Public Health Office of Thailand’s northeastern province of Mukdahan confirmed a fourth case of anthrax in a recent outbreak, with one fatality reported so far. The three remaining patients remain hospitalised—two at Mukdahan Hospital and one at Don Tan Hospital. A Department of Disease Control spokesman linked the cases to an event last month in which cattle were slaughtered and the raw meat shared around the community.  Thai authorities had identified at least 638 people as being potentially exposed after eating the meat, with all at-risk people having completed a seven-day period of observation. The outbreak is concentrated in Don Tan district, classified as an outbreak zone, with health authorities focused on early detection. The provincial livestock office quarantined 124 animals for 30 days and administered antibiotics and vaccines to over 1,200 animals within a 5km radius. In neighboring Lao PDR, authorities have banned the import of all animals and animal products from Thailand. Lao authorities have also launched vaccination campaigns in high-risk areas.

MALAYSIA
Bank Negara Malaysia maintains overnight policy rate at 3.00% 
(08 May 2025) Bank Negara Malaysia (BNM) maintained its overnight policy rate (OPR) at 3.00%, unchanged since May 2023, aligning with expectations from 24 of 30 economists in a Reuters poll. Despite strong first-quarter performance, BNM indicated downside risks to economic growth due to global trade tensions and geopolitical uncertainties. Malaysia’s inflation fell to 1.4% in March, a four-year low, while first-quarter growth was recorded at 4.4%. BNM projected headline inflation to be between 2% and 3.5% in 2025 and core inflation between 1.5% and 2.5%, following 1.8% for both measures in 2024. Prime Minister Anwar Ibrahim noted that the suspension of most U.S. tariffs until July has mitigated economic impacts but acknowledged that Malaysia is unlikely to meet its 4.5% to 5.5% growth forecast for 2025. Malaysia faces a 24% tariff on exports to the U.S. from July unless negotiations succeed in lowering it. Other central banks in Asia, including those in Indonesia, Korea, Thailand, and the Philippines, have implemented multiple rate cuts to support growth.

INDONESIA
Indonesia’s Djarum Group launches first domestically assembled EVs 
(06 May 2025) Indonesian conglomerate Djarum Group, through its subsidiary Polytron, launched two domestically assembled electric vehicles (EVs), the Polytron G3 and G3+, becoming the first Indonesian conglomerate to do so. Prices range from IDR 299 million (USD 18,166) to IDR 459 million, with options for fixed or rented replaceable batteries. Polytron is offering a three-year buyback guarantee at 70% of the original price. The cars are assembled at Handal Indonesia Motor’s facility in Purwakarta, West Java, which also manufactures for BAIC, Chery, Geely, and NETA. Polytron plans to sell up to 1,500 units this year and expand to ASEAN markets, leveraging its 60 electronic dealerships and eight new showrooms in Java. Indonesia’s Industry Minister highlighted the local content level of 40% but noted challenges in expanding car ownership. Polytron also plans to develop its own manufacturing facility in Subang, West Java. Indonesia’s automotive market saw a decline to 865,000 cars in 2024 from over 1 million in 2023, while EV sales grew to over 44,000 units, up 160% from 2023.

SINGAPORE
Retail sales increases by 1.1% year-on-year in March 2025 
(05 May 2025) Singapore’s retail sales increased by 1.1% year-on-year in March, recovering from a 3.5% decline in February, according to the Singapore Department of Statistics. Excluding motor vehicles, retail sales rose 0.7%, reversing a 6.5% drop in the prior month. The total retail sales value reached USD 4.3 billion, with online sales contributing 13.4%, up from 12.3% in February. Watches and jewellery led growth with a 13.5% rise, followed by cosmetics, toiletries, and medical goods at 3.6%, and supermarkets and hypermarkets at 3.4%. Conversely, petrol service stations and wearing apparel and footwear experienced declines of 8.2% and 8%, respectively. Food and beverage sales fell 2.8% year-on-year and 3.2% on a seasonally adjusted basis, with a total sales value of USD 60 million, of which 24.9% came from online sales. Restaurant sales dropped 6.6%, while food caterers saw a 19.6% increase. DBS Bank noted mixed performance across the 14 major categories and warned of potential downside risks due to global trade tensions affecting business hiring and wage growth, potentially impacting retail sales in the second half of 2025.

INDONESIA
Economy grows by 4.87% year-on-year in Q1 2025, slowest pace since Q3 2021 
(05 Mat 2025) Indonesia’s economy grew 4.87% year-on-year in Q1 2025, its slowest pace since Q3 2021, down from 5.02% in the previous quarter, aligning with analysts’ expectations of 4.91% growth. President Prabowo Subianto aims to lift GDP growth to 8% during his term, but faces challenges from global trade tensions, weakening domestic demand, and budget constraints. U.S.-bound exports may be impacted by upcoming tariffs, with Jakarta seeking negotiations to avoid them. Maybank Indonesia highlighted global trade tensions as a key risk, while Bank Danamon projected further deceleration to 4.79% in Q2 but maintained a 4.8% full-year forecast. Indonesia’s Q1 GDP contracted 0.98% quarter-on-quarter, and household spending, comprising over half of GDP, grew 4.89%, its slowest in five quarters, with weak footwear sales despite Ramadan. Investment growth slowed to 2.12%, the lowest in two years, and government spending contracted, although net export contributions rose due to slower imports. Indonesian authorities noted that Indonesia’s growth remained above the G20 average and expected government spending to drive momentum.

THE PHILIPPINES
Bangko Sentral ng Pilipinas unlikely to intervene to cap strengthening of peso
(07 May 2025) Philippine central bank Governor Eli Remolona indicated that Bangko Sentral ng Pilipinas (BSP) is unlikely to intervene to cap the strengthening of the peso, attributing its rise to broader dollar weakness. The peso reached its highest level since March 2024, driven by optimism over trade deals. Remolona stated that intervening would counter prevailing market conditions. BSP’s stance contrasts with central banks in Taiwan and Hong Kong, which have acted to moderate their currencies’ appreciation.

VIET NAM
Viet Nam introduces 10-year golden visa programme aimed to individuals contributing to tourism, innovation, or economy 
(08 May 2025) Vietnam introduced a 10-year golden visa programme aimed at enhancing its position as a sustainable travel and investment hub in Southeast Asia. The visa offers long-term, renewable residency to individuals contributing to tourism, innovation, or the economy, with a particular focus on attracting Indian nationals. Visa procedures for tourism and short-term business travel have been streamlined, reducing the need for embassy visits. In the first four months of the year, Vietnam recorded 7.67 million foreign visitors, a 23.8% increase year-on-year, according to the Vietnam National Authority of Tourism. China led with 1.95 million visitors, followed by South Korea (1.58 million), Taiwan (440,000), and the United States (323,000). European markets showed steady growth, with notable increases from Italy (32.6%), France (24.7%), and the UK (20.7%). The Vietnam National Authority of Tourism plans to launch seven promotional campaigns targeting 22 to 23 million international arrivals by year-end. Major cities like Ho Chi Minh City, Hanoi, and Da Nang are highlighted for their safety, affordability, and availability of international amenities.

RCEP Monitor

AUSTRALIA
Newly reelected Prime Minister Anthony Albanese announces visits to Malaysia, Indonesia, and Canada
(05 May 2025) Australian Prime Minister Anthony Albanese, following his re-election, announced upcoming diplomatic visits to Malaysia, Indonesia, and Canada. His first visit will be to Indonesia, continuing discussions with President Prabowo Subianto. He also accepted an invitation from Canadian Prime Minister Marc Carney to attend the G7 Summit in Alberta this June, which may include a meeting with US President Donald Trump, following a recent phone call discussing US-imposed tariffs. Albanese is scheduled to attend the ASEAN Summit in Kuala Lumpur on 26-27 May and will visit Papua New Guinea in September for its 50th Independence anniversary. In the recent elections, the ruling Labor Party secured 87 of 150 seats in the House of Representatives, enabling Albanese to form a new government. Opposition leader Peter Dutton conceded defeat and congratulated Albanese.

JAPAN
Government rejects proposal to reduce consumption tax rate 
(09 May 2025) Japan’s government rejected the proposal to reduce the consumption tax rate despite inflation and U.S. tariffs, with the Chief Cabinet Secretary stating that it would be “inappropriate” due to its role in funding social security. Prime Minister Shigeru Ishiba also expressed caution, highlighting the need for discussions with the Komeito party, which is advocating for a tax cut on food items ahead of the House of Councillors election. The consumption tax currently stands at 8% for food and beverages and 10% for other items. The Constitutional Democratic Party of Japan (CDPJ) has called for a one-year removal of the tax on food items, while CDPJ chief Yoshihiko Noda questioned the government’s reluctance to implement relief measures. Within the ruling Liberal Democratic Party (LDP), some lawmakers are pushing for permanent tax exemptions on food and beverages. Japan’s fiscal health remains the weakest among advanced economies, with approximately one-third of its annual budget allocated to social security costs. The consumption tax was last raised from 8% to 10% in 2019, with the additional revenue committed to social security funding. The government and LDP plan to draft an economic package ahead of the upper house election.

CHINA, ASEAN
Exports increase by 8.1% year-on-year in April 2025
(08 May 2025) China’s exports increased by 8.1% in April year-on-year, surpassing Reuters’ poll expectations of 1.9%, driven by a 20.8% surge in shipments to the Association of Southeast Asian Nations (ASEAN) and an 8.3% rise to the European Union. Exports to Vietnam and Malaysia were strong, while Indonesia and Thailand saw 37% and 28% growth, respectively. In contrast, shipments to the U.S. fell by over 21%, with imports dropping nearly 14%, impacted by tariffs of 145% imposed by the U.S., to which China responded with 125% tariffs on American imports. Chinese factory activity hit a 16-month low in April, with new export orders declining, raising concerns over job losses, with Goldman Sachs estimating 16 million job losses in sectors tied to U.S.-bound exports. To counter these effects, Chinese authorities have increased stimulus measures, including easing monetary policy. Local governments and businesses are supporting exporters in redirecting products to the domestic market, potentially increasing deflationary pressure. China is set to release inflation data, with forecasts suggesting a 0.1% drop in the consumer price index and a 2.8% decline in the producer price index.