Southeast Asia to become fourth ‘largest’ economy

The Australian government expects Southeast Asia to become the world’s fourth ‘largest’ economy by 2024.

The government recently announced at the ASEAN-Australia Special Summit in Melbourne the implementation of new initiatives to focus on stepping up 2-way trade and investment between the regions.

The initiatives fulfill recommendations from Invested: Australia’s Southeast Asia Economic Strategy to 2040, which was launched last year by the Albanese government to deepen the country’s economic engagement with the region. 

The Southeast Asia Investment Deal teams will draw on the expertise of Austrade, the Department of Foreign Affairs and Trade, and Export Finance Australia to increase the nation’s investment. 

They plan to focus on priority sectors including infrastructure, net zero transition, agrifood, health, digital economy, and advanced manufacturing. 

On the sidelines of the ASEAN Summit, a memorandum of understanding between Austrade and Veitrade was signed to encourage increased investment and commercial opportunities between Australia and Vietnam. 

Meanwhile, the Australia Southeast Asia Business Exchange program focuses on increasing 2-way trade through targeting business missions across priority sectors. 

The Austrade team will visit Singapore and Malaysia in April 2024, focusing on the clean energy transition. The aim is to help more Australian businesses identify and capture commercial opportunities in the fast-growing, rapidly changing markets of Southeast Asia. 

On 5 March 2024, the government established a $2 billion finance facility — managed by Export Finance Australia — to boost investment in Southeast Asia.

The facility offers loans, guarantees, equity, and insurance for projects that aim to boost Australian trade and investment in Southeast Asia, focusing on the clean energy transition and infrastructure development. 

Prime Minister Anthony Albanese says: “These initiatives represent further investment in our future and ensure we are working with Southeast Asia as it continues to grow in economic size and reach.”

In 2022, Australia’s two-way investment with ASEAN was worth $307 billion, while two-way trade accounted for $178 billion — about 15% of Australia’s trade. 

The Australian Trade and Investment Commision notes there will also be an additional $140 million over 4 years to extend the partnerships for the Infrastructure program, which has been running since 2021 and helps partners expedite transport connectivity, clean energy transition, and telecommunications reforms. 

Further, this supports efforts to improve regional infrastructure development and attract more diverse, quality infrastructure finance. 

Write to Aaliyah Rogan at Mining.com.au   

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Written By Aaliyah Rogan
Relocated from the East Coast in New Zealand to Queensland Australia, Aaliyah is a fervent journalist who has a passion for storytelling. When Aaliyah isn’t writing stories, she is either spending time with friends and family or down at the beach.