Page 169 - CW E-Magazine (8-7-2025)

Special Report

Southeast Asia: Innovation engine for global supply

chains

outheast Asian countries, collec- annually.Meanwhile, the Philippines re-
tively known as the ASEAN, mains in the early planning stages. This
Shave shown the ability to adapt is despite the transport sector contributing
prosper amid economic uncertainty. over 50% of outdoor air pollution in urban
The region’s plastics manufacturing areas like Metro Manila. The shift to
sector, in particular, has leveraged its EVs is seen as a critical solution for
strategic position within global sup- improving urban air quality.
ply chains and its diversifi ed industrial
base – including automotive, bioplas- Despite strong growth potential,
tics, medical devices, packaging, and Southeast Asia’s EV industry still faces
chemicals. key challenges including high costs of
EV batteries, shortages of parts, lack of
While the plastics market in the EV experts & skills programmes, elec-
region is already growing due to a boom- tricity grid challenges and inconsisten-
ing manufacturing sector, rising con- $6-bn by 2030, with a 32% CAGR, cies in EV charging standards & instal-
sumer goods demand and increasing according to Mordor Intelligence. lation guidelines, says the Malaysian
urbanisation, it may also benefi t from a Investment Development Authority.
windfall of sorts given the tariff s being Thailand, known as the ‘Detroit
imposed in the US by President Donald of Asia’, is pushing ahead, aiming for The US-ASEAN Business Council
Trump on imports to the US. Since the 30% production by 2030 (725,000 cars, highlights foreign direct investment as
tariff s threaten supply chains and will 675,000 motorcycles). The country has crucial for overcoming these barriers
increase costs for US manufacturers, also signifi cantly reduced excise tax for and accelerating EV adoption in South-
it is expected that US companies will electric cars from 8% to 2% and off ers east Asia.
seek out other sourcing locations, import duty reductions of up to 40%,
perhaps even to Asia. attracting manufacturers like China’s Medical technology – fi lling the
BYD, which recently opened its fi rst prescription for growth
Preliminary growth reports suggest Southeast Asian EV plant there. Southeast Asia’s medical devices
that Southeast Asia’s plastics sector will sector is expanding rapidly, driven by
register an output of 32-mt this year and Malaysia is ‘walking the talk’ as it rising healthcare demand, an aging
grow by 4% to almost 39-mt by 2030, recently launched its fi rst locally pro- population, and technological advance-
according to Mordor Intelligence. duced battery electric vehicle, e-Mas, ments. The market is projected to reach
manufactured by national car brand, $12-bn by 2025 and $16-bn by 2029
Regional EV growth accelerates Proton, in collaboration with Chinese (+7.5% CAGR), according to Statista.
In recent years, Southeast Asia has automaker, Geely. Proton has also
intensifi ed its eff orts to ramp up poli- established a new R&D centre in China Southeast Asia’s rapid integration
cies for the adoption of electric vehicles to accelerate EV development. of advanced technologies, such as auto-
(EVs), in response to the growing global mation, telemedicine, AI-driven health-
take on carbon emissions reductions. As the world’s top nickel producer, care solutions and robotics, plus health-
According to the ASEAN Secretariat, Indonesia is focusing on battery produc- care infrastructure expansion – new
the region’s per capita CO emissions tion. In 2023, the country produced 55-mt hospitals, care facilities, and strengthen-
2
remain among the lowest in the world of nickel – 42% of global supply. It is ing of medical workforce support –
at 3.9 tonnes – well below China (7.1) staying on track to produce 140 gigawatt will amplify the need for increased
and the US (14). With strong growth hours (GWh) of batteries by 2030, and capital fl ow and business opportunities.
potential in production and natural last year, launched its fi rst $1-bn EV
resources, Southeast Asia’s EV market battery plant in Karawang, West Java, Malaysia is emerging as the fastest-
is set to grow from $1.5-bn in 2025 to capable of powering 150,000 EVs growing market, focusing on ultra-

Chemical Weekly July 8, 2025 169

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