ASEAN
Southeast Asian tech giant’s shares diverge, with Grab jumping due to cost-cutting measures
(28 August 2023) The stock prices of Southeast Asian tech giants such as Grab, GoTo, and Sea have greatly diverged in 2023 as investors seek companies that have engaged in cost-cutting rather than those with costly growth plans. Grab Holding’s shares are up 15% this year through 25 August, 2023, reflecting strong demand for its ride-hailing and food delivery segments as well as cost-cutting measures announced in June which would see more than 1,000 jobs slashed (11% of its total workforce). The ride-hailing and food delivery giant now expects to break even on a group level in the third quarter of 2023 on an adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) basis, ahead of its previous target for the final quarter. By contrast, Sea’s shares plunged 29% after the company announced it intends to boost investment into its e-commerce business Shopee. The company warned this might lead to losses.

THAILAND
Office of Industrial Economics downgrades industrial GDP for 2023, projects 1.5% to 2.5% contraction
(01 September 2023) Thailand’s Office of Industrial Economics (OIE) has downgraded its estimation for Thailand’s industrial GDP for 2023, now projecting a contraction of between 1.5% to 2.5%. Earlier in June 2023, the OIE had predicted that industrial GDP for this year would expand by 0.0% to 1.0%. The OIE had also downgraded its estimation for Thailand’s manufacturing production index (MPI) for 2023, projecting a contraction of 2.8% to 3.8%. It had previously projected that MPI would expand by 0.0% to 1.0%. These downgrades were attributed to factors including the declining purchasing power of the agricultural sector, the global economic slowdown, financial problems affecting export partners, geopolitical conflicts, climate change’s impact on agricultural output, high energy prices as well as higher interest rates. These factors have driven up manufacturing costs while also diminishing the competitiveness of Thai products in global markets.

THAILAND
Proposed visa waiver for Chinese and Indian tourists expected to boost tourism revival
(01 September 2023) The Thai government is proposing a visa waiver for Chinese and Indian tourists, sparking hopes for the revival of Thailand’s tourism sector. The lengthy visa application process has been cited as a bottleneck for the industry. In the first half of 2023, the average waiting time for a Chinese visitor to obtain a tourist visa to Thailand was nearly 15 days. Indian and Chinese tourists can also apply for a visa on arrival, albeit with several requirements. It is hoped that the new Thai government can implement the plan before the peak season in November 2023. The country expects to welcome up to 30 million international tourists in 2023, nearly thrice the numbers in 2022 though still lower than the 40 million received in 2019 (prior to the COVID-19 pandemic).

MALAYSIA
Property prices and rentals in Johor Bahru now closing to rates in Klang Valley
(21 August 2023) Property prices of high-rise projects and rental rates at shopping malls in Johor Bahru city center are now closing to rates in the Klang Valley, driven by the effects of the Johor Bahru-Singapore Rapid Transit System (RTS) Link and a strong Singapore dollar. According to RHB Investment Bank, a lot of infrastructure projects, property developments, facility expansions, and investments are taking place in Iskandar Malaysia, a development zone formed by major cities in Johor state. It has also been noted that expensive rental rates in Singapore are starting to drive up rental rates in Johor Bahru city center. As well, malls located in the city center are expected to benefit from greater connectivity and higher shopper traffic from Singapore.

INDONESIA
Indonesia’s CPI rises by 3.27% in August 2023, within central bank’s target range
(01 September 2023) Indonesia’s consumer price index (CPI) rose by 3.27% in August 2023, a slight increase from the 3.08% recorded in July. The CPI score in August is still within Bank Indonesia’s 2023 inflation target range of 2% to 4%. Annual core inflation, which strips out government-controlled prices and volatile food prices, eased in August to 2.18% from 2.43% in July. While headline inflation only rose modestly, annual rice inflation accelerated to 13.76% in August, the highest since June 2012. Indonesia is suffering from tight domestic supply of rice due to paddy fields having been hit by drought linked to the ongoing El Niño weather pattern. In response, the Indonesian government has approved an import quota of 2.3 million metric tonnes to help boost rice supplies at home.

INDONESIA
Government expands subsidy program for electric motorcycle purchases
(30 August 2023) The Indonesian government has expanded a subsidy program for the purchase of electric motorcycles. Through the program, Indonesians will receive a discount of US$460 valid for the one-time purchase of an electric motorcycle. The expansion of the assistance program comes five months after the government first introduced the subsidy to selected groups of people earlier in March 2023. The program is aimed at accelerating the setting up of an electric vehicle (EV) ecosystem in the country. Electric motorcycle sales had risen 191% from around 12,000 units in 2021 to 35,000 in 2022.

SINGAPORE, MALAYSIA, INDONESIA
Data center operators in Singapore exploring alternative sites in Malaysia and Indonesia
(31 August 2023) Data center operators in Singapore are exploring alternative sites in Malaysia and Indonesia due to Singaporean authorities limiting the construction of new facilities due to space constraints and enviromental concerns. Princeton Digital Group (PDG) is scheduled to complete a US$450 million data center with a capacity of 150 megawatts in Malaysia’s Johor Bahru in May 2024, while another facility is being planned in Indonesia’s Batam Island. In 2019, Singapore paused the construction of new data centers due to enviromental concerns. In July 2023, the government ended the moratorium and awarded rights to four operators, including Microsoft and a consortium comprised of China’s ByteDance and Australia’s AirTrunk. Capacity was limited to just 80 MW for the four winners.

RCEP Monitor

THAILAND
Srettha Thavisin of Pheu Thai Party officially appointed as country’s 30th prime minister
(23 August 2023) On 23 August, 2023, 61-year-old property tycoon Srettha Thavisin of the Pheu Thai Party received a royal endorsement from King Maha Vajiralongkorn to become the country’s 30th prime minister. The new government will be formed after the appointment of his cabinet ministers, with Pheu Thai currently negotiating with its coalition partners. Among Srettva’s key policies include transferring US$286 into the digital wallets of people over age 16 across the country, to be spent in small shops within a 4-kilometer radius of the recipient. He also intends to hike the minimum wage to THB600 (US$17.07) per day, nearly double the current THB300 (US$8.53) to THB330 (US$9.39). Srettha forms a government amidst a slowing economy, having expanded 1.8% year-on-year in the second quarter of 2023. This is a slower pace than the 2.6% expansion in the first quarter. Exports of goods contracted 5.7% in the second quarter.

THAILAND
Property sector’s post-pandemic recovery delayed due to political uncertainty
(25 August 2023) The post-COVID-19 pandemic recovery of Thailand’s property sector has been delayed due to the country’s ongoing political uncertainty. More than three months after the country’s general elections on 14 May, 2023, a new cabinet has still not been identified. The real estate sector is one of the key drivers of the Thai economy, contributing about 10% of GDP. Many developers have delayed launches due to the current political vacumn. It was projected that almost 45,000 new condominium units would be launched in the Bangkok Metropolitan area. However, after the first half of 2023, only 12,000 units have been launched. Rising interest rates have also affected the sector, as it is causing consumers to delay purchases.

THAILAND, INDONESIA, MALAYSIA 
Central banks of Malaysia, Indonesia, and Thailand sign MOUs to strengthen cooperation and promote usage of local currencies
(25 August 2023) The central banks of Malaysia, Indonesia, and Thailand, Bank Negara Malaysia (BNM), Bank Indonesia (BI), and the Bank of Thailand (BOT) respectively, have signed three bilateral memoranda of understanding (MoUs) on a framework for cooperation to promote the usage of local currencies in bilateral transactions between the countries. According to BNM, the scope of the framework has been expanded to include more eligible cross-border transactions beyond trade and direct investments. The new framework also intends to synergise with cross-border payment initiatives to create more accessible and efficient local currency settlements to enhance regional financial market stability and strengthen cross-border economic activities.

MALAYSIA
Rate of inflation slows down to 2% year-on-year in July 2023, lowest so far in 2023
(25 August 2023) According to Malaysia’s National Statistics Department, Malaysia’s rate of inflation slowed down to 2% year-on-year in July 2023, its lowest so far this year. This was attributed to a slower increase in the costs of restaurants and hotels and food and non-alcoholic beverages. This was lower than the 2.4% growth recorded in June. Monthly headline inflation eased to 0.1% against 0.2% recorded in June, while core inflation increased 2.8% as compared to 3.1% the preceding month. Food and non-alcoholic beverages recorded a moderate increase of 4.4%, while the restaurants and hotels category registered a 5% increase.

SINGAPORE
Grab expected to turn its first quarterly profit earlier than projected
(24 August 2023) Singapore-based Grab expects to turn its first quarterly profit sooner than projected. The company now expects to break even on a group level in the third quarter of 2023 on an adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) basis, ahead of the previous target of the final quarter. Grab also expects to narrow their adjusted EBITDA loss for 2023 to US$30 million to US$40 million, compared with an earlier forecast of a US$195 million to US$235 million loss. On 23 August, 2023, the company announced a US$148 million loss for the second quarter, compared with a US$572 million loss for the same period in 2022. This follows a series of cost-cutting measures as well as increased demand for the company’s ride-hailing and food delivery services.

THE PHILIPPINES
Central bank expects GDP growth in 2023 to miss government target
(21 August 2023) The Philippines’ central bank, the Bangko Sentral ng Pilipinas (BSP), expects GDP growth in 2023 to miss the government’s target due to moderating economic activity and the impact of recent rate hikes. The BSP stated that growth this year could settle below the official target of 6% to 7% for 2023 and 6.5% to 8.0% for 2024 and 2025. The BSP stated that the economy is expected to ‘operate close to potential, on average, in 2023’, but will moderate over the policy horizon due to waning pent-up demand and the effects of prior monetary policy tightening. A policy horizon refers to the time required to bring inflation within the target of a central bank. The BSP has raised its key rate by 4.25 basis points since May 2022.

INDONESIA
Indonesian government to temporarily relax solar power rules to spur development of solar energy
(21 August 2023) The Indonesian government will temporarily relax solar power rules to help spur the development of solar energy within the country and to help it reach its target of net zero emissions by 2050. Authorities will remove requirements that mandate solar projects use a majority of domestically produced materials until 2025, when Indonesia’s first solar panel factory is expected to begin production. Lifting local content requirements for solar was one of more than a dozen policy reforms laid out in the draft investment plan for the US$20 billion Just Energy Transition Partnership that Indonesia previously negotiated with the United States and other wealthy countries. Authorities intend to increase its solar power capacity fivefold in the next five years, and will require nearly US$2.4 billion to do so.

RCEP Monitor

MALAYSIA
Six state elections held in Malaysia end with status quo results
(13 August 2023) On 12 August, 2023, six states in Malaysia held state elections, seen by pundits as indicative of the level of support for the ruling unity government of political coalitions Pakatan Harapan (PH) and Barisan Nasional (BN). State elections were held in the states of Kedah, Penang, Kelantan, Terengganu, Selangor and Negeri Sembilan, and saw the PH-BN unity government compete with the opposition coalition Perikatan Nasional (PN). The state elections ended with a status quo result, with PH-BN holding onto Selangor, Negeri Sembilan, and Penang, while PN held onto their states of Kedah, Kelantan, and Terengganu. That being said, PN was able to make inroads into certain seats in PH-BN-held states. PN was able to deny PH-BN a two-thirds majority in the economically key state of Selangor.

THAILAND
Tropical resorts attract foreign tourists seeking to escape heat waves at home
(13 August 2023) Tropical resorts in Thailand are attracting foreign tourists seeking to escape heat waves at home. In parts of the world impacted by heat waves, such as parts of the United States and southern Europe, authorities have urged residents to refrain from going out, making it difficult for tourists to visit the regions. A byproduct of the heat waves, fueled by climate change, may ultimately prove welcome for Thailand’s COVID-19-hit tourism sector. The summer vacation season in Europe, the U.S., and Japan runs from June to October, corresponding to Thailand’s rainy season, which foreign tourists typically like to avoid. But should Thailand still be able to attract foreign visitors even during its rainy season, the still-recovering tourist industry stands to benefit.

THAILAND
Domestic milled rice prices jump nearly 20% last week after rice export ban by India
(17 August 2023) A recent rice export ban by India on 20 July, 2023, has triggered chaos in Thailand’s rice trading, with domestic milled rice prices jumping nearly 20% last week to US$597 per ton, up from around US$479 over the previous few weeks. This has pushed up the Thai export price for benchmark white rice by 5% to US$610 per ton, reflecting the rise in global prices, which have surged to an 11-year high. Although Thai authorities have not limited rice exports, exporters are still reluctant to sell due to uncertainty over supplies. Cases of hoarding are expected to push Thai rice prices to uncompetitive levels. In addition, the El Nino dry weather pattern is expected to limit Thailand’s rice harvest and prevent the country from exporting more rice in 2023 and 2024.

THE PHILIPPINES, VIET NAM, INDIA
The Philippines negotiating with Viet Nam and India to import rice to lower prices
(12 August 2023) The Philippines is currently negotiating with India and Viet Nam to import rice in order to boost its buffers and lower prices. According to Filipino officials, Vietnamese exporters have already quoted prices that are as much as US$40 lower than at a recent meeting. It is hoped that this will pave the way for the Philippines to get better terms for an additional 300,000 metric tons to 500,000 metric tons of rice importation for 2023. The additional rice purchases may lower prices for Filipinos as it will boost national inventory, which even without imports is expected to last for 52 to 57 days by the end of 2023. In December 2022, Filipino agriculture officials stated that rice imports in 2023 will reach around 2.5 million metric tons, from about 3.5 million metric tons in 2022.

THE PHILIPPINES
Central bank keeps policy rate steady at 6.25% for third straight meeting
(17 August 2023) The Philippines’ central bank, the Bangko Sentral ng Pilipinas (BSP), kept its benchmark interest rate unchanged at 6.25% for a third straight meeting on Thursday. BSP stated it needed to balance the need to support economic growth while keeping inflation in check. The BSP’s decision to extend its policy pause followed data released last week showing the domestic economy growing at its slowest annual pace in nearly 12 years in the second quarter of 2023. This was attributed to a decline in government spending and weaker domestic demand. While prices cooled for a sixth straight month in July 2023, the 4.7% inflation rate remained outside the official target of 2% to 4% inflation.

INDONESIA
Indonesia to launch Southeast Asia’s first high-speed rail in October 2023
(16 August 2023) Indonesia is set to launch Southeast Asia’s first high-speed rail in October 2023. The 140-kilometer track that connects Jakarta and Bandung will have a top operating speed of roughly 350 kilometers per hour, and the entire line can be traversed in as little as 36 minutes. The Indonesian government had set October as the new opening date for commercial operations after pushing back the previous timeline of August. A trial launch is planned for September and October. The high-speed rail is part of China’s landmark Belt and Road Initiative project. The project was initially set to open by 2018, after having broken ground in 2016. Contributing to the delays were difficulties in acquiring land.

SINGAPORE
Sea Ltd. to ramp up investments into e-commerce unit Shopee amidst increasing competition from new rivals like Tiktok
(16 August 2023) Singapore-based tech giant Sea Ltd. plans to ramp up investments into its e-commerce unit Shopee amidst increasing regional competition from new rivals like TikTok. Chinese short video platform Tiktok launched online shopping service TikTok Shop in 2021. Sea did not disclose any figures regarding the investments, although it acknowledged that said investments will impact its bottom line and may result in losses for Shopee and Sea Group as a whole in certain periods. Sea posted a net income of US$330 million for the April-June period of 2023, a turnaround from a US$931 million loss in the same period in 2022. This was the company’s third consecutive quarterly profit.

RCEP Monitor

INDONESIA
Indonesia’s economy expands by 5.17% year-on-year in the second quarter of 2023
(07 August 2023) Indonesia’s economy expanded by 5.17% year-on-year in the second quarter of 2023, accelerating from a revised 5.04% expansion in the first quarter. These latest growth figures were the highest in three quarters. Private consumption, which makes up over half of Indonesia’s GDP, rose 5.23% year-on-year in the same quarter, while investments increased 4.63%. Private consumption was buoyed during the Islamic holy month of Ramadan held from late March to late April. Ramadan generally brings the year’s biggest monthly consumer spending, thanks to holiday bonuses that companies are obliged to pay their employees. Consumer spending is expected to grow steadily ahead of elections to be held in February 2024.

SINGAPORE, MYANMAR
Singaporean bank UOB cuts off counterparts in Myanmar in blow to military junta
(09 August 2023) Singaporean bank United Overseas Bank (UOB) is reportedly cutting off counterparts in Myanmar in what is expected to be a major blow to the country’s ruling military junta. In a confidential note sent to Myanmar banks last week, UOB stated it would restrict all incoming and outgoing payments to and from Myanmar accounts, only allowing funds to be moved between accounts held with the bank. It was also announced that tough new curbs on Visa card and Mastercard transactions for Myanmar individuals and banks would be implemented, which would restrict their dealings only to accounts within UOB. The new UOB framework is to take effect on 01 September, 2023, applying to transactions in all main currencies, including the U.S. Dollar, Euro and Singapore Dollar.

SINGAPORE
Singapore downgrades growth forecast for 2023 to 0.5% to 1.5%
(11 August 2023) Singapore downgraded its growth forecast for 2023 to 0.5% to 1.5% down from the 0.5% to 2.5% range earlier forecasted. This was attributed to a weak global economy and sluggish demand from key trading partners like China. GDP growth for the second quarter of 2023 stood at 0.5% year-on-year, compared with a preliminary 0.7% expansion announced in July and 0.4% growth in the first quarter. On a quarter-on-quarter seasonally adjusted basis, the country’s GDP expanded 0.1% in the second quarter, reversing a 0.4% contraction from the previous three months. These latest data demonstrate weaknesses in Singapore’s manufacturing sector outweighing the more resilient services sector. The manufacturing sector, which fell 7.3% year-on-year in the second quarter, accounts for a fifth of Singapore’s overall economy.

THAILAND
Thai equities rebound as domestic investors see months-long political standoff being resolved soon
(07 August 2023) Thai equities have seen a rebound as domestic investors see a potential end to the months-long political standoff that has paralyzed the country. The benchmark stock index has rallied more than 4% from a 28 June trough. While the SET gauge is still Asia’s worst-performing equity market in 2023, the recent performance outpaced a 1.6% gain in the broader regional gauge. Global funds have sold US$3.7 billion of the country’s equities thus far this year. Foreign investors are expected to stay away from Thai equities until there is more clarity about the new government to be formed. Since the general election held in May 2023, local investors have increased net equity purchases by US$1.64 billion, while foreign funds pulled a net US$1.67 billion from local stocks in the same period.

THE PHILIPPINES
Philippines’ economy slows down to 4.3% growth year-on-year in the second quarter of 2023
(10 August 2023) The Philippines’ economy slowed down to 4.3% growth year-on-year in the second quarter of 2023, a significant drop from the 6.4% growth recorded in the first quarter. Besides the pandemic years of 2020 and 2021, the annual expansion in the second quarter was the slowest since 2011. The economy fell 0.9% quarter-on-quarter, against a median estimate of a 0.6% gain. The drop in growth was attributed to high commodity prices, the lagged effects of rising interest rates, contraction in government spending, and a slowing global economy. Growth in the first half of this year stood at 5.3%, while policymakers target a 6% to 7% full-year expansion.

CAMBODIA
Government confident of hitting 16 million domestic tourists target for 2023
(09 August 2023) Authorities are confident of hitting its goal of 16 million domestic tourists in 2023. According to figures released by the Ministry of Tourism, as of the end of July, 2023, there were more than 12 million domestic tourists recorded in the first seven months of 2023. The ministry also predicted that Cambodia will greet five million international guests by the end of this year. By 2026, authorities believe that the number of international visitors will increase to about seven million. The months of July and August usually see less internal tourist movement due to the rainy season, with the numbers expected to rebound in September with the celebration of the traditional Buddhist festivals of Kan Ben and Pchum Ben.

VIET NAM
World Bank forecast Viet Nam’s GDP growth to slow to 4.7% in 2023
(10 August 2023) The World Bank has forecast that Viet Nam’s GDP growth would slow to 4.7% in 2023 from 8% in 2022, citing a challenging external environment and weak domestic demand. The global financial institution also predicted that growth would accelerate to 5.5% in 2024 and 6.0% in 2025. This comes as US President Joe Biden recently stated he would travel to Viet Nam as part of efforts to improve relations with Hanoi. Both parties have increasingly close trade links, and also share concerns vis-a-vis China’s geopolitical ambitions, the latter of which includes its sweeping claims over the South China Sea.

RCEP Monitor

MALAYSIA
Malaysia aiming to have renewables supply 70% of total energy supply by 2050
(31 August 2023) Malaysia has launched programs to promote renewable energy in an economy that has traditionally relied upon the hydrocarbons industry. Under the first phase of the National Energy Transition Roadmap (NETR) unveiled last week, the government identified 10 flagship catalyst projects and initiatives ranging from constructing renewable energy zones and creating biomass demand to carbon capture and promoting greener mobility. These projects are expected to generate estimated investments of more than US$5.5 billion and 23,000 jobs, while also reducing greenhouse gas emissions by the equivalent of more than 10,000 gigagrams of carbon dioxide per year. The government targets having renewables supply some 70% of the total energy supply by 2050.

THAILAND, CHINA
Renewable energy operator Energy Absolute to partner with Chinese firm to set up EV battery factory
(02 August 2023) Thai renewable energy operator Energy Absolute is currently negotiating with two Chinese manufacturers of electric vehicle (EV) batteries to build a new factory in Thailand. Energy Absolute is in talks with both EVE Energy and Sunwoda Mobility Energy Technology, China’s third-largest and fifth-largest lithium-ion battery producers respectively. The company hopes to set up an EV battery plant with an annual production capacity of 6 gigawatt-hours. This would mean the factory would have one of the largest battery production capacities in Thailand, rivaling the country’s oil and gas conglomerate PTT, which has partnered with Contemporary Amperex Technology in another 6 gigawatt-hours factory project. The new Energy Absolute battery factory is expected to supply EV batteries for Energy Absolute’s EV vehicles, ferries, and energy storage systems.

INDONESIA
Authorities hope new capital city can become new economic growth center
(02 August 2023) Indonesian authorities hope the new capital city Nusantara, located in East Kalimantan province on Borneo island, can become a new economic growth center for Indonesia. By August 2024, the Indonesian government will have already shifted some government functions to the new capital. The government also hopes to attract various industries to Nusantara, including renewable energy, health care, education, and agriculture. The relocation of the Indonesian government from Jakarta to Nusantara will take place in five phases through 2045. The population of Nusantara is projected to reach 60,000 in 2024, rising to 2 million by 2040 and more than 4 million in 2060. The city will have a land area of 2,561 sq. kilometers.

THAILAND
Thailand urges farmers to switch to other crops to save water amidst poor rainfall
(02 August 2023) Thai authorities are urging farmers to switch to growing other crops in order to save water amidst poor rainfall. Thailand is experiencing less rain as the nation braces for a potential drought next year with the onset of the El Niño weather pattern. Cumulative rainfall in the central region of Thailand has been about 40% below normal levels and the move to curb planting of rice is to help conserve water for household consumption. Thailand’s central region is a key rice-growing region, accounting for almost 14% of total rice-growing area in 2023, and forecasted to make up about 19% of the main paddy harvest in both 2023 and 2024. Rice prices in Asia surged to its highest in more than three years in July 2023 after India banned some of its rice exports. While India accounts for 40% of the global trade in rice, Thailand and Viet Nam make up 15% and around 14% respectively.

THE PHILIPPINES, EU
The Philippines and the EU to relaunch free trade negotiations
(31 July 2023) During a visit to the Philippines, European Commission President Ursula von der Leyen announced that the EU and the Philippines would relaunch negotiations for a free trade agreement. She stressed that the EU is seeking to diversify its supply chains and ‘de-risk’ trade relations. The EU will also provide US$514 million in funding for the ‘transition to a circular economy, and the generation of green energy’ through its Global Gateway sustainable investment plan. The EU will also launch a ‘digital economy package’ to bolster connectivity and make the Philippines a more attractive place for European businesses. The EU is the Philippines’ fourth-largest trading partner.

VIET NAM
Vietnamese government calls upon Samsung to create local talent pipeline for executives
(01 August 2023) The Vietnamese government calls upon Samsung to create a local talent pipeline for executives to lead its factories. Samsung has invested in Viet Nam for the last 15 years, with the country currently producing half of its global devices. Samsung Vietnam exports to 128 markets and comprises 17.4% of shipments from the Southeast Asian nation. Viet Nam has struggled to gain the necessary skills, technology, and supplier ecosystem to move up the value chain. The government also called upon Samsung to increase tech transfer, invest in female staff, and help Viet Nam move to a green and ‘socialist-oriented market economy’.

LAO PDR
Almost 1.7 million foreign tourists visited Lao PDR in first half of 2023
(01 August 2023) According to data compiled by the Tourism Marketing Department of the Ministry of Information, Culture and Tourism, almost 1.7 million foreign tourists visited the country in the first half of 2023. This is a significant increase from the first half of 2022, when only 211,971 foreign tourists came to Lao PDR. Data revealed that 668,595 visitors came from Thailand, 398,937 from Viet Nam,​ 317,634 from China, 72,958 from the Republic of Korea, 30,455 from the US, 18,145 from the United Kingdom, and 18,794 from France. Authorities and local businesses have joined forces to promote tourism and access a broader audience through international exhibitions, ASEAN tourism fairs, and the development of new tourism products.

RCEP Monitor

THE PHILIPPINES, MALAYSIA
The Philippines and Malaysia set to increase cooperation in areas including transnational crime, agriculture, and digital economy
(27 July 2023) The Philippines and Malaysia are set to convene joint meetings in October 2023 to increase cooperation in various areas including transnational crime, agriculture, and digital economy. This was agreed during the Philippines’ President Ferdinand Marcos Jr.’s three-day state visit to Malaysia. Other areas which will see bilateral cooperation include halal industry, Islamic banking, education, tourism and culture, and sports. The Malaysian government also offered to help build capacity in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) in the southern Philippines, especially in priority sectors such as halal, Islamic banking, and food security. In 2022, Malaysia was the 10th largest trading partner of the Philippines, with trade totaling US$8.84 billion. Malaysia also ranked as the Philippines’ 11th largest export destination and 9th largest import source, valued at US$2.46 billion and US$6.38 billion respectively.

ASEAN
Honda Motor to launch e-motorbike sales in Indonesia, sees Southeast Asia as promising market
(26 July 2023) Global motorcycle leader Honda Motor will be launching its first electric two-wheeler models in Indonesia, seeing Southeast Asia as a promising market for its e-motorcycles. The EM1 e: scooter, scheduled to go on sale in Japan in late August 2023, will be the first electric motorcycle made by Honda for the Indonesian market. Honda plans to release another model in Indonesia within the year, and two more in 2024. There are plans to sell seven e-motorbike models by 2030, with a sales target that year of 1 million units. Honda aims to sell 3.5 million e-motorbikes globally in 2030, with close to 30% of those sales expected to come from Indonesia. The Southeast Asian motorcycle market reached 10.6 million units in 2022, and is the world’s third-largest market after China and India.

INDONESIA
Indonesian e-commerce and superapp company GoTo makes e-wallet app accessible throughout the country
(26 July 2023) Indonesian e-commerce and superapp company GoTo made its e-wallet app accessible throughout the country, as it looks to tap into a large number of unbanked Indonesians. Previously, the e-wallet GoPay could only be accessed for payments via the apps of Gojek and Tokopedia, both of whom merged in May 2021 to form GoTo. By launching the app, GoTo hopes to extend its user base beyond its existing customers. According to research by Google, Temasek, and Bain & Co., over 80% of Indonesia’s population are unbanked or underbanked. Unbanked people do not have bank accounts, while those who are underbanked have bank accounts but insufficient access to financial services such as credit.

MALAYSIA
Malaysian government unveils plan to ‘reset’ Malaysia’s growth trajectory
(26 July 2023) On 27 July, 2023, the Malaysian government unveiled a plan to ‘reset’ Malaysia’s growth trajectory. The plan seeks to boost incomes and increase female labor force participation, while also reducing the budget deficit. The ten-year plan involves attracting companies that create high-income jobs for locals with tax breaks, boosting manufacturing, and implementing reforms to make its stock markets attractive. One of the key outcomes targeted by this plan includes achieving a fiscal deficit of 3% of GDP or lower. The Malaysian government also seeks to boost economic growth to 6% in the short-term. In 2023, officials project that the Malaysian economy will expand by between 4% to 5%.

SINGAPORE
Manufacturing output decreases 4.9% year-on-year in June 2023
(26 July 2023) According to the Economic Development Board, Singapore’s manufacturing output decreased 4.9% year-on-year in June 2023. Excluding biomedical manufacturing, manufacturing output fell 5.2%. On a three-month moving average basis, manufacturing output decreased 7.3% year-on-year in June 2023, while on a seasonally adjusted month-on-month basis, manufacturing output increased 5.0%. Looking at the performance of specific clusters, it was noted that output for transport engineering increased 10.8% year-on-year in June, while output for biomedical manufacturing decreased 1.8% year-on-year. For other clusters, it was observed that the electronics sector fell 2.9%; general manufacturing decreased 7.5%; chemicals output shed 8.6%; and precision engineering decreased 11.5%.

SINGAPORE, BRUNEI DARUSSALAM, CHINA        
China to reinstate its 15-day visa-free entry for citizens of Singapore and Brunei Darussalam
(23 July 2023) China will reinstate its 15-day visa-free entry for citizens of Singapore and Brunei Darussalam from 26 July, 2023 onwards. This follows a three-year suspension of visas as China adopted strict travel restrictions under its stringent zero-COVID-19 policy, which only ended in December 2022. According to the Chinese Embassy in Singapore, Singaporean citizens will be able to enter China without a visa for 15 days if they are there for business, tourism, family visits and transit. Visas already issued to Singaporeans will still be valid, while those that have been requested will be processed. According to Singapore’s Ministry of Foreign Affairs, the resumption of visa-free travel will facilitate people and business flows between our countries and pave the way for deeper bilateral cooperation.

CAMBODIA
Cambodian Prime Minister Hun Sen to step down, eldest run to succeed him
(26 July 2023) On 26 July, 2023, Cambodian Prime Minister Hun Sen announced he would step down, with his eldest son Hun Manet to succeed him. Hun Sen announced the post-election timeline of Hun Manet’s accession, with the next step coming in August 2023 when the National Election Committee formalizes the results of the national election held on 23 July, 2023. Following this, the newly elected lower house of parliament will convene and vote on Hun Manet’s candidacy. The ruling Cambodian People’s Party claimed 96% of parliamentary seats after its main rival, the Candlelight Party, was disqualified in May 2023. Hun Sen stated that he would run for a seat in Cambodia’s Senate in February 2024 and then become the Senate president.

RCEP Monitor

ASEAN
Amount raised through initial public offerings (IPOs) rise by 43% from January-June 2023
(19 July 2023) The amount raised through initial public offerings (IPOs) rose by 43% year-on-year in January-June 2023, even though the amount raised worldwide dropped by 30%. IPOs throughout this period raised US$4.1 billion, while the number of IPOs increased by 14% year-on-year to 79. Both the number of IPOs and the amount that they raised have been increasing since 2019. Indonesian gold and copper miner Amman Mineral International raised the most funds at the time of its IPO at over US$700 million. A portion of those funds will be used by the company to invest in the refining of copper and precious metals. Indonesia alone accounted for 41 IPOs, more than half of the total in Southeast Asia. The top four fundraisers were also Indonesian. With the current decline in the number of unicorn-level startup listings, stock exchanges in Southeast Asia are now seeing listings by medium-size companies and by companies affiliated with large corporate groups.

THE PHILIPPINES, JAPAN
The Philippines unveils new light rail cars for Metro Manila made using Japanese technology
(20 July 2023) The Philippines unveiled new light rail cars made using Japanese technology that will serve Metro Manila, connecting the northern and southern halves of the capital city. The new light rail cars were sought to improve transport capacity while also reducing congestion and pollution. The trains feature higher energy efficiency and lower maintenance costs than their predecessors. Japanese trader Mitsubishi Corp. is delivering 120 cars as part of a US$214 million order funded by an international yen loan, with the cars to be built by Spanish manufacturer CAF. The current administration of President Ferdinand Marcos Jr has initiated rail development projects as part of its ‘Build Better More’ infrastructure agenda. With Japanese aid, construction has also begun on the first subway line in the Philippines.

MALAYSIA, INDONESIA, ISRAEL
Israeli foodtech companies seeking to expand to Muslim-majority markets of Malaysia and Indonesia
(19 July 2023) Israeli foodtech companies are seeking to expand into the Muslim-majority markets of Malaysia and Indonesia, despite the lack of political recognition by both countries of Israel. Israeli foodtech companies are planning halal-certified alternative protein products for practicing Muslims within ASEAN. In the global alternative proteins market, Israel is the biggest recipient of investment after the U.S. and tops other markets such as China and Singapore. From 2020 to 2022, Israel drew in US$1.19 billion in alternative protein-related investments. Market research specialist GWI estimates there are 29.8 million potential consumers of cultured and artificial meat within Southeast Asia. Many Israeli foodtech companies have come to view Singapore as a springboard to the wider ASEAN market.

MALAYSIA
Overall trade value contracts by 16.3% year-on-year in June 2023
(20 July 2023) Malaysia’s overall trade value contracted by 16.3% year-on-year in June 2023 to US$48.90 billion, as the value of shipments exchanged with its major trading partners continued to drop. The decline in trade value was attributed to a 14.1% drop in exports to US$27.29 billion and an 18.9% contraction in imports to US$21.60 billion. Malaysia’s trade surplus in June 2023 rose by 11.3% year-on-year to US$5.68 billion. Export value was bolstered by strong demand for electrical and electronic (E&E) products, iron and steel products, metalliferous ores and metal scrap, transport equipment, and processed food. For the second quarter of 2023, trade value dropped by 11.3% year-on-year to US$141.58 billion.

SINGAPORE, INDIA 
Temasek looking for strategic partners as it seeks to deploy up to US$5 billion a year in India
(19 July 2023) Singaporean state investor Temasek Holdings Pte is seeking strategic partners as it looks to deploy between US$3 billion and US$5 billion a year in India. Temasek is planning on hiring another four or five investment professionals to bring its India team to more than 20 people. The company could deploy as much as US$10 billion to the country in three years, and the deployment could be through a mix of partnerships and more capital in public equities. Over the last five or six years, Temasek has been ramping up investments in India. The company is targeting banks, financial operations, healthcare, technology, and consumer sectors. About 60% of Temasek’s investments in India are direct stakes.

INDONESIA, INDIA
Indonesia and India seeking to settle bilateral transactions in local currencies and to link-up payments systems
(16 July 2023) Indonesia and India are seeking to settle bilateral transactions in local currencies and to link up their fast payment systems to facilitate cross-border funds transfers. India’s Finance Minister Nirmala Sitharaman and her Indonesian counterpart Sri Mulyani Indrawati discussed the proposals ahead of recent meetings among the Group of Twenty (G20) countries in India, with formalities yet to be complete. Idrawati stated that the meeting sought to strengthen bilateral trade and investment. India has so far linked its fast payments system with Singapore, and is currently negotiating with several others, including Japan and France, to likewise facilitate fast cross-border transactions.

ASEAN, INDIA
India emerging as key growth market for Southeast Asia’s travel and tourism sector
(17 July 2023) India is emerging as a key growth market for Southeast Asia’s travel and tourism sector. From airlines to hospitality chains, companies are seeking to tap into India’s burgeoning middle class. The travel and tourism industry contributed about 12% of the region’s GDP before the COVID-19 pandemic, and currently employs more than 40 million people. The influx of Indian tourists has helped make up for the weak recovery of Chinese tourism to Southeast Asia, with the number of Chinese visitors in May 2023 at least 60% lower than the same month in 2019. As of June 2023, seat capacity on scheduled flights between China and Southeast Asia was 57% below pre-COVID-19 levels, while flights from India to the region had recovered to about 90%. In general, Indians can get visas much more easily from Southeast Asian countries than they can from European countries or the United States.

RCEP Monitor

ASEAN
Myanmar crisis expected to dominate ASEAN Foreign Ministers’ Meeting this week
(14 July 2023) The ongoing Myanmar crisis is expected to dominate the ASEAN Foreign Ministers’ Meeting as well as the post-ministerial conferences and related meetings being held this week, including the ASEAN Regional Forum to be held on 14 July, 2023. An estimated 3,750 civilians have been killed by Myanmar security forces and nearly 24,000 arrested since the military overthrew the civilian government of Aung San Suu Kyi in February 2021. Little progress has been made on the Five Point Plan devised by ASEAN that calls for, among other things, an immediate end to the violence and dialogue among all contending parties. Other issues expected to be discussed at the forum include the tensions in the South China Sea as well as a growing arms race within the region. The foreign ministers of ASEAN dialogue partners will also be attending, including U.S. Secretary of State Antony Blinken, Russian Foreign Minister Sergey Lavrov and Chinese Foreign Minister Qin Gang.

ASEAN
Rate hikes squeezes profit margins for ASEAN’s millions of MSMEs
(12 July 2023) Recent rate hikes across Southeast Asia are squeezing the profit margins of the region’s estimated 71 million micro, small and medium-sized enterprises (MSMEs). According to the chairman of the ASEAN Business Advisory Council, any surge in interest rates directly escalates the costs of financing for MSMEs, leading to decreased profitability, further limiting their access to capital, and amplifying the risks of default. MSMEs account for 97% of the region’s businesses and employ 67% of the working population, while contributing an average of 40.5% to each country’s GDP. Higher interest rates will also impact the demand side for MSMEs, leading to lower sales. By one estimate, a 1% hike in interest rates could result in a 0.5% drop in the profitability of MSMEs.

INDONESIA
Indonesian government passes new healthcare bill aimed at reforming healthcare industry
(11 July 2023) The Indonesian parliament passed a new healthcare bill aimed at reforming the healthcare industry and improving life expectancy within the country. Parliament approved the law in a plenary session after deliberating the bill for months. The bill has received opposition from Indonesia’s nurses and doctors due to fears that policy changes allowing foreign doctors to operate in Indonesia could jeopardize their jobs. They also argued that the deliberation process at parliament lacked transparency. Life expectancy in Indonesia stood at 71.3 years in 2019, compared with the 76.3 years average for upper-middle-income countries. Indonesia has six doctors for every 10,000 people, according to World Bank data.

THE PHILIPPINES
The Philippines to remain expanding and young population in 2050
(10 July 2023) According to the World Bank’s Development Research Group, the Philippines will remain an expanding and young population by 2050. The number of children per woman in the Philippines is about 2.8, well above the 2.1 replacement rate. With developed and some middle income countries facing declining populations, this will intensify the global competition for workers, with the Philippines well positioned to meet this future global demand for manpower. However, many young people in countries whose populations are expanding are also entering the workforce without the skills needed in the global labor market, including in the Philippines. Bangko Sentral ng Pilipinas expects the country’s remittances, a key driver of consumer spending, to grow 3% in 2023 and 2024.

MALAYSIA
Malaysian Prime Minister Anwar Ibrahim to hold virtual meeting with Tesla CEO Elon Musk by end of week
(10 July 2023) Malaysian Prime Minister Anwar Ibrahim will hold a virtual meeting with Tesla Inc. CEO Elon Musk by the end of this week. It is also confirmed that Tesla will officially launch in Malaysia on 20 July, 2023. In March 2023, Tesla stated it would start selling electric vehicles (EVs) in Malaysia to tap into the rising foreign demand for EVs in Southeast Asia. The company plans to open an office in Malaysia, introduce service centers, and build a network of superchargers. The virtual meeting between Anwar Ibrahim and Elon Musk may go beyond exploring EV investment opportunities in Malaysia, and look into other areas of potential collaboration. The Malaysian government plans to increase its network of EV chargers tenfold within the next two years.

VIET NAM, UNITED STATES
Visiting delegation from Nebraska hopes to grow agricultural trade with Viet Nam
(12 July 2023) A visiting delegation from the US state of Nebraska, led by Governor Jim Pillen, hopes to expand the state’s trade with Viet Nam, particularly in terms of agricultural products. The delegation visited MM Mega Market in Ho Chi Minh City’s Thu Duc City on 11 July, 2023 to understand what Vietnamese customers look for at the grocery store as well as distribution networks in Viet Nam. The governor noted that agriculture drives the Nebraskan economy, and that the delegations’ aim is to help Nebraskan businesses and companies make connections in the Vietnamese market. Viet Nam already imports goods worth almost US$1 billion from Nebraska. The delegation is seeking to promote beef, corn gluten, soybean meals, and other agricultural goods from Nebraska.

SINGAPORE
Sovereign wealth fund Temasek reports US$6 billion net loss for year through March 2023
(11 July 2023) Singapore’s sovereign wealth fund Temasek reported a US$6 billion net loss for the year through March 2023, coming largely from paper losses booked as a result of a downturn in equity markets over the past year, as well as new accounting principles it adopted in 2018. Temasek logged a one-year total shareholder return of -5.07% in Singapore dollar terms, compared with a 5.81% annual return a year ago. The company stated its overall portfolio continued to recover from the COVID-19 pandemic, despite the drops in valuations in areas such as technology, health care and payments that led to the net loss. Singapore remained the wealth fund’s top investment destination, with assets there comprising 28% of its portfolio. China came second at 22%, followed by the Americas at 21%.

RCEP Monitor

MALAYSIA
9.8 million voters eligible to vote in six state elections to be held on 12 August, 2023
(05 July 2023) Some 9.8 million voters will be eligible to vote in six state elections to be held on 12 August, 2023, where they will be able to choose between Prime Minister Anwar Ibrahim’s multiracial unity government and the Malay-majority federal opposition pact. Nominations for the polls will be on 29 July, 2023, and the Election Commission is allowing for a two-week campaign period. The local polls are seen as the first referendum on the new government formed by Anwar Ibrahim after a general election held in November 2022. Out of Malaysia’s 13 states, the six states up for contest include Kelantan, Terengganu, and Kedah, controlled by the Islamist-leaning opposition, and Selangor, Penang, and Negeri Sembilan, controlled by the current unity government.

INDONESIA, PAPUA NEW GUINEA
Indonesia and Papua New Guinea agree to boost border trade
(05 July 2023) During a visit by Indonesian President Joko Widodo to Port Moresby, Papua New Guinea, on 05 July, 2023, both parties agreed to boost border trade.This follows Papuan lawmakers in March 2023 finally ratifying an agreement governing its 760-kilometer border with Indonesia after a decade-long delay, possibly opening the way to improving relations. Annual trade between Indonesia and Papua New Guinea was about US$200 million a year, a small amount when compared to the latter’s trade with other countries. Indonesia also pledged new aid for Papua New Guinea, including US$15 million for upgrading a hospital in Port Moresby as well as support for current Papuan efforts in building more roads.

INDONESIA
Indonesian gold miner set to trade in Jakarta following Indonesia’s largest IPO in 2023
(05 July 2023) Indonesian gold and copper miner PT Amman Mineral Internasional is set to start trading in Jakarta on 07 July, 2023, following Indonesia’s largest initial public offering (IPO) in 2023. The company raised US$711 million in its IPO, making it the largest new share sale in Asia in 2023 outside mainland China. IPOs in Jakarta have raised a total of US$2.2 billion since the start of 2023, already overtaking the tally for all of 2022. Amman Mineral owns the fifth-largest copper mine in the world as of end-2020. The company posted net income of US$1.09 billion in 2022, more than a threefold increase from the previous year’s figure. Proceeds will be used by Amman Mineral for working capital, debt repayment and to fund refinery projects in West Nusa Tenggara province.

INDONESIA
Indonesia seeking financing for US$48 billion new capital city Nusantara
(05 July 2023) The Indonesian government is seeking financing for its US$48 billion new planned capital city Nusantara. The new capital city is envisioned as a green, smart city spanning nearly 260,000 hectares to be located in East Kalimantan province. The Indonesian government plans to foot 20% of the total cost of the project while private investors will finance the rest. Indonesia has approached other countries seeking investments into Nusantara, including Saudi Arabia, the United Arab Emirates, Japan, South Korea, Iran, Canada, Germany, and Singapore. Australia has offered support for Indonesia in developing its new capital city, including scholarships for Indonesians to study sustainable urban planning and local government administration, as well as heightened collaboration between government authorities to share information and experiences about building a new capital city. These new commitments by Australia are expected to be formalized via a memorandum of understanding in the coming months.

SINGAPORE
Central bank sees residential property market in ‘good place’
(05 July 2023) According to the Monetary Authority of Singapore (MAS), Singapore’s residential property market is in a ‘reasonably good place’, with signs that prices are moderating and stabilizing. Singapore has undergone a property boom that has defied a global slowdown, with the Singaporean housing market having seen a buoyant run after an influx of capital alongside a pandemic-induced supply shortage pushed prices and rents to record highs. In response, in April 2023 the government doubled stamp duties for foreign buyers to 60%. It also raised levies for second-home buyers. Home prices declined in the second quarter of 2023 for the first time in three years. According to the MAS, the surge in rental prices will take ‘a little bit of time to resolve’, with rents for private apartments and public housing having surged about 27% and 25% respectively in May 2023 from a year ago.

THE PHILIPPINES
Inflation rate slows for fifth straight month in a row in June 2023
(05 July 2023) According to the Philippine Statistics Authority (PSA), the inflation rate in the Philippines slowed for the fifth straight month in a row in June 2023. The inflation rate eased to 5.4% in June 2023 from 6.1% in May, bringing the year-to-date rate to 7.2%. This is the fifth time that inflation dropped from a peak of 8.7% in January 2023. The inflation rate in June 2023 is also the lowest rate in 15 months. According to the Philippines’ Finance Secretary, inflation is on track to further decline to within the government’s target range of 2% to 4% by the end of 2023. Inflation is also expected to fall below the lower limit of the target in the first quarter of 2024. The slowdown in inflation in June 2023 versus May 2023 was attributed to the slower movement in the prices of food and non-alcoholic beverages. Food inflation, which tracks price movements in a basket of commonly purchased foods, also declined for the fifth consecutive month in June at 6.7% from 7.5% in May.

VIET NAM
Viet Nam welcomed over 5.5 million foreign visitors to country in first six months of 2023
(05 July 2023) According to the Vietnam National Administration of Tourism, Viet Nam welcomed 5.5 million foreign visitors in the first six months of 2023, already exceeding the total number of international arrivals in 2022. Viet Nam’s tourism sector has set a target of 8 million visitors for the remainder of 2023. However, the tourism bureau has since predicted the numbers will likely rise to 10 million. Despite this, international arrivals into Viet Nam are still far off pre-COVID-19 pandemic levels, with nearly 19 million international arrivals being recorded in 2019. Tourism into Viet Nam is expected to get a boost from a new, recently approved visa policy for international visitors. Under the new policy, visa waivers for visitors from selected countries will be tripled from 15 to 45 days. As well, for visitors from countries eligible to apply for an electronic visa to Viet Nam, visas will now be valid for up to 90 days with single or multiple entries.

RCEP Monitor

ASEAN
Return of El Nino weather pattern causing fears of forest fires and droughts across Southeast Asia
(23 June 2023) The return of the El Nino weather pattern to Southeast Asia, and the sweltering heat it is expected to bring to the region, is sparking fears of possible water shortages and forest fires. El Nino is a climate pattern originating in the Pacific Ocean which is marked by above-average sea surface temperatures. It typically brings hot and dry conditions to Southeast Asia. Higher temperatures are expected to impact agricultural production in the region, while pressures on water and electricity supply might impact manufacturing. The peak of El Nino is expected to occur in September 2023. Among the agricultural sectors expected to be impacted include palm oil production in Malaysia and Indonesia, coffee in Viet Nam, rice and sugar in Thailand, and rice and corn in the Philippines. Considering that agriculture accounts for a large share of GDP in emerging Asia, a decline in agricultural production and resulting inflation are expected to put strong downward pressure on their economies. El Nino is also expected to impact hydropower output and also push up demand for electricity.

INDONESIA
Indonesian solar energy startup seeking to close new funding round by end of 2023
(26 June 2023) Indonesian solar energy startup Xurya aims to close a new funding round by the end of 2023. Founded in 2018, the company develops rooftop solar panels for businesses and industries. The company had initially raised US$11.5 million in the second tranche of its Series A round in October 2022. It had raised US$21.5 million in the first tranche in December 2021. Altogether, the company had raised a total of US$33 million in its Series A round. Indonesia is believed to have huge solar power potential, with a report by the Institute for Essential Services Reform arguing that solar power will play an essential role in deep decarbonization goals in Indonesia in 2060 or sooner in 2050. According to a report by Mordor Intelligence, the solar energy market is projected to register a compound annual growth rate of about 10% from 2019 to 2028.

MALAYSIA
Exports expected to reach US$425 billion by 2030 according to Standard Chartered
(26 June 2023) According to a recent report by Standard Chartered, Malaysia’s exports are expected to reach US$425 million by 2030 with an annual growth rate of 6.8%. The report also emphasized the rapid growth of other economies such as India, Indonesia and Viet Nam as key trading partners for Malaysia. The report stated that Malaysia’s exports to India would reach US$18 billion with a compound annual growth rate (CAGR) of 10.1% by 2030, followed by Indonesia (US$12 billion with a CAGR of 9%) and Vietnam (US$13 billion with a CAGR of 8.7%). In line with the projected export growth, the Malaysian government has made significant investments into strengthening its export infrastructure. Machinery and electricals are expected to dominate its exports in 2030, making up 53% of the share of exports with a
CAGR of 6.8%.

THAILAND
Thai universities struggling with lower enrolments due to Thailand’s low birth rate
(25 June 2023) Thai universities are struggling with lower enrolments linked to a sharp decline in the country’s birth rate over the past few years. Thailand’s current higher education market is relatively small, with 200 to 300 universities taking in fewer students than their annual capacity. Over the past five years there has also been a continuous decline in the number of births, having dropped from over a million births 30 years ago to 500,000 to 600,000 a year. In 2021, Thailand registered some 544,000 births, its lowest in at least six decades. The head of the business analytics and intelligence programme at the Graduate School of Applied Statistics of the National Institute of Development Administration (Nida) warned that state and private universities may struggle to survive in the next five years if they do not adapt, possibly leading to mergers or closures. Some have managed to survive by actively recruiting Chinese students.

THAILAND, UK
Thailand and the UK to hold second Joint Economic and Trade Committee (Jetco) meeting in November 2023
(29 June 2023) The UK and Thailand are set to hold a second Joint Economic and Trade Committee (Jetco) meeting in Thailand in November 2023. Both parties had signed a memorandum of understanding (MoU) to establish Jetco in 2022, which aims to promote and enhance economic cooperation on trade and investment, particularly in sectors of mutual interest. According to Thailand’s Trade Negotiations Department, both parties are ready to elevate their economic cooperation to an enhanced trade partnership or a strategic economic partnership in sectors such as food, beverages, health, education, automotives, and agriculture. Both parties ultimately aim to pave the way for future free trade negotiations. In 2022, the UK was Thailand’s 22nd largest trading partner, with bilateral trade amounting to US$6.20 billion, up 12.3% from the previous year.

VIET NAM
Viet Nam has to take ‘aggressive’ measures to meet growth goals for 2023, claims finance minister
(24 June 2023) According to Viet Nam’s finance minister, Viet Nam needs to take ‘aggressive’ measures to meet the government’s growth goals for 2023. Viet Nam saw growth of more than 8% in 2022, its highest growth rate since 1997. But growth slowed in the first quarter of 2023 to 3.3 %, down from 5.9% in the fourth quarter of 2022, amidst declining global demand for its exports. The decline in global demand has been attributed to multiple factors, including the ongoing war in Ukraine which raised petroleum and consumer prices, thus putting pressure on manufacturing input and trade costs and depressing buyers’ appetite. Hanoi targets full-year growth of 6% to 6.5%, following anticipated first-half growth of about 4%. To meet these targets, the government is planning to undertake measures such as extending deadlines for tax payments as well as reducing value added tax and petrol levies.

SINGAPORE
National University of Singapore first Asian university to break into top 10 of QS World University Rankings
(28 June 2023) In the QS World University Rankings 2024, the National University of Singapore (NUS) became the first Asian university to break into the top 10 of the world ranking. NUS moved up three spots to reach Number 8. Singapore’s Nanyang Technological University, on the other hand, maintained its place within the top 30. QS’ latest ranking utilizes a new methodology, in which academic reputation is deemphasized in favor of new metrics like sustainability, employment outcomes and international research networks. NUS’ strong showing was attributed in part to funding in Singapore. NUS was placed Number 7 in terms of employment outcomes.

RCEP Monitor