January 31, 2025 • 8 mins
In this episode, Michelle introduces the top stories impacting Southeast Asia's economic landscape. The discussion begins with Indonesia's recent BRICS membership, exploring its potential implications for the country's economic and geopolitical standing. Michelle then delves into the surge in Indonesia's electric vehicle market, analyzing the factors driving this growth and its significance for the region. The episode also highlights Indonesia's nickel industrialization, considering its economic impact and future prospects. The episode concludes with closing remarks and a call to follow the podcast for continued insights into Southeast Asia's dynamic markets.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Welcome back to the Southeast Asia MarketsDaily Brief.
I’m your host, AI Michelle.
Here are our top stories today...
First, Indonesia has become a member of theBRICS group.
Second, Chinese electric vehicles are drivingrecord-high sales in Indonesia and are set for
explosive growth in twenty twenty-five.
(00:21):
Third, we explore how nickel industrializationis transforming Indonesia’s economy.
In a significant development for both Indonesiaand the broader BRICS grouping, Indonesia has
officially become a member of BRICS in twentytwenty-five.
This move marks a pivotal shift in the globaleconomic landscape, as Indonesia, the largest
(00:43):
economy in the Association of Southeast AsianNations, joins forces with Brazil, Russia,
India, China, and South Africa.
Experts suggest that Indonesia's inclusion willnot only bolster the BRICS' influence on the
world stage but also accelerate Indonesia's owneconomic growth trajectory.
(01:04):
Indonesia's accession to BRICS is strategicallysignificant for several reasons.
As a rapidly growing economy, Indonesia bringsa dynamic and youthful demographic, a robust
consumer market, and a wealth of naturalresources to the table.
This addition is likely to enhance the economicclout and diversity of the BRICS group, making
(01:26):
it more representative of the global south andeast.
With its strategic geographical location,Indonesia serves as a crucial bridge between
Asian economies and the rest of the BRICSmembers.
For Indonesia, joining BRICS presents amultitude of opportunities.
It opens doors to increased trade andinvestment flows, knowledge exchange, and
(01:49):
collaboration on various fronts, includinginfrastructure development, technology
transfer, and energy cooperation.
This membership aligns with Indonesia's broadereconomic goals of enhancing its global
competitiveness and fostering sustainableeconomic development.
Prabowo Subianto, the President of Indonesia,expressed gratitude towards India for
(02:11):
supporting Indonesia’s permanent membership inBRICS.
He emphasized that this cooperation would bebeneficial for global stability and regional
collaboration.
This sentiment underscores the potential forIndonesia to play a leading role within the
BRICS framework, contributing to globaleconomic governance and regional integration.
(02:32):
As Indonesia steps into this new phase ofinternational cooperation, it will be
interesting to watch how the dynamics withinBRICS evolve and what new economic
opportunities this membership will unlock forIndonesia and its partners.
In recent years, Indonesia has witnessed aremarkable surge in electric vehicle sales,
driven primarily by Chinese carmakers.
(02:55):
In twenty twenty-four, sales of electricvehicles more than doubled to a record
forty-three thousand units, marking a pivotalmoment for the country's automotive industry.
This growth is largely attributed to the strongpresence of Chinese manufacturers such as BYD,
which sold over fifteen thousand units, furtherestablishing itself as a dominant force in
(03:18):
Southeast Asia's electric vehicle market.
This surge in electric vehicle sales contrastssharply with the decline in conventional car
sales.
While battery electric vehicle sales surged byover one hundred fifty percent, conventional
car sales experienced a fourteen percent dropin wholesale to eight hundred sixty-six
(03:38):
thousand units and nearly eleven percent inretail to around eight hundred ninety thousand
units.
This shift reflects changing consumerpreferences and the growing impact of
government-backed incentives promoting greenertransportation options.
Analysts predict that this growth trend willonly gain momentum in twenty twenty-five,
(03:59):
fueled by extended sales tax incentives forcarmakers committed to establishing
manufacturing facilities within Indonesia.
These incentives are seen as a strategic moveby the government to attract foreign investment
and boost local production, further cementingIndonesia's position as a key player in the
global electric vehicle industry.
(04:21):
However, despite the impressive sales figures,electric vehicle adoption rates in Indonesia
remain relatively low compared to neighboringcountries such as Singapore and Thailand.
The absence of home-grown four-wheel electricvehicle manufacturers in Indonesia means that
major foreign players are expected to continuedominating the market in the foreseeable
(04:43):
future.
This presents both a challenge and anopportunity for the Indonesian automotive
industry, as it seeks to develop its owncapabilities and reduce reliance on imports.
The Indonesian government's commitment tofostering a sustainable automotive industry is
evident through its policy initiatives andincentives aimed at encouraging electric
(05:04):
vehicle adoption.
As the country continues to navigate thetransition towards greener transportation
solutions, the role of Chinese carmakers andthe potential for local manufacturing will be
pivotal in shaping the future of Indonesia'sautomotive landscape.
Our final story today dives into thetransformative impact of nickel
(05:26):
industrialization on Indonesia's economy.
As the world's largest producer and exporter ofnickel, Indonesia has strategically shifted
from exporting raw minerals to industrializingits downstream mining sector.
This shift has not only reshaped the economiclandscape but also positioned Indonesia as a
(05:47):
significant player in the global supply chainfor electric vehicle batteries and stainless
steel production.
According to Energy and Mineral ResourcesMinister Bahlil Lahadalia, Indonesia's policy
on nickel industrialization has been agame-changer.
Since the policy's inception, nickel exportvalues have skyrocketed from three point three
(06:08):
billion dollars in two thousand seventeen tothirty-three point five billion dollars in two
thousand twenty-three.
This remarkable growth has attractedforty-seven point three six billion dollars in
new investment and created one hundred eightythousand six hundred new jobs, contributing
thirty-four point one billion dollars toIndonesia’s exports.
(06:30):
The government’s ban on raw nickel exports,enforced in January two thousand twenty, has
been pivotal in this transformation.
This ban has compelled foreign companies,particularly from China, South Korea, and the
United States, to invest in domestic processingand smelting facilities.
Companies like Tesla, CATL, and LG EnergySolution have shown a keen interest in securing
(06:54):
their supply chains within Indonesia,reinforcing the country's role in the electric
vehicle revolution.
Minister Bahlil highlighted that for decades,Indonesia relied heavily on exporting raw
materials, a model inherited from the Dutchcolonial era.
While this approach provided quick revenuepost-independence, it wasn't sustainable for
(07:15):
long-term growth.
The industrialization of the downstream miningsector, starting with nickel, offers a
sustainable economic trigger that could beapplied to other sectors like forestry,
fisheries, oil, and gas.
This policy shift began under President SusiloBambang Yudhoyono and was aggressively enforced
by President Joko Widodo, despite oppositionfrom Western economies.
(07:39):
Under President Prabowo Subianto, the policycontinues to expand, with a special task force
led by Bahlil overseeing its execution.
Plans to extend this industrialization approachto bauxite and tin are already underway,
promising further economic growth anddevelopment.
As Indonesia continues to harness its richnatural resources through industrialization,
(08:02):
the country is poised for substantial economicgains.
By transforming its resource-based economy,Indonesia is not only enhancing its global
competitiveness but also setting a precedentfor other resource-rich nations seeking
sustainable growth paths.
Alright that's a wrap for this episode.
(08:22):
If you enjoyed this brief, and would like tostay updated on latest episodes, don’t forget
to click ‘Follow’ in your podcast app.
Thanks again for listening, and hope to catchyou next time.
Welcome back to the Southeast Asia MarketsDaily Brief.
I’m your host, AI Michelle.
Here are our top stories today...
First, Indonesia has become a member of theBRICS group.
Second, Chinese electric vehicles are drivingrecord-high sales in Indonesia and are set for
explosive growth in twenty twenty-five.
(00:21):
Third, we explore how nickel industrializationis transforming Indonesia’s economy.
In a significant development for both Indonesiaand the broader BRICS grouping, Indonesia has
officially become a member of BRICS in twentytwenty-five.
This move marks a pivotal shift in the globaleconomic landscape, as Indonesia, the largest
(00:43):
economy in the Association of Southeast AsianNations, joins forces with Brazil, Russia,
India, China, and South Africa.
Experts suggest that Indonesia's inclusion willnot only bolster the BRICS' influence on the
world stage but also accelerate Indonesia's owneconomic growth trajectory.
(01:04):
Indonesia's accession to BRICS is strategicallysignificant for several reasons.
As a rapidly growing economy, Indonesia bringsa dynamic and youthful demographic, a robust
consumer market, and a wealth of naturalresources to the table.
This addition is likely to enhance the economicclout and diversity of the BRICS group, making
(01:26):
it more representative of the global south andeast.
With its strategic geographical location,Indonesia serves as a crucial bridge between
Asian economies and the rest of the BRICSmembers.
For Indonesia, joining BRICS presents amultitude of opportunities.
It opens doors to increased trade andinvestment flows, knowledge exchange, and
(01:49):
collaboration on various fronts, includinginfrastructure development, technology
transfer, and energy cooperation.
This membership aligns with Indonesia's broadereconomic goals of enhancing its global
competitiveness and fostering sustainableeconomic development.
Prabowo Subianto, the President of Indonesia,expressed gratitude towards India for
(02:11):
supporting Indonesia’s permanent membership inBRICS.
He emphasized that this cooperation would bebeneficial for global stability and regional
collaboration.
This sentiment underscores the potential forIndonesia to play a leading role within the
BRICS framework, contributing to globaleconomic governance and regional integration.
(02:32):
As Indonesia steps into this new phase ofinternational cooperation, it will be
interesting to watch how the dynamics withinBRICS evolve and what new economic
opportunities this membership will unlock forIndonesia and its partners.
In recent years, Indonesia has witnessed aremarkable surge in electric vehicle sales,
driven primarily by Chinese carmakers.
(02:55):
In twenty twenty-four, sales of electricvehicles more than doubled to a record
forty-three thousand units, marking a pivotalmoment for the country's automotive industry.
This growth is largely attributed to the strongpresence of Chinese manufacturers such as BYD,
which sold over fifteen thousand units, furtherestablishing itself as a dominant force in
(03:18):
Southeast Asia's electric vehicle market.
This surge in electric vehicle sales contrastssharply with the decline in conventional car
sales.
While battery electric vehicle sales surged byover one hundred fifty percent, conventional
car sales experienced a fourteen percent dropin wholesale to eight hundred sixty-six
(03:38):
thousand units and nearly eleven percent inretail to around eight hundred ninety thousand
units.
This shift reflects changing consumerpreferences and the growing impact of
government-backed incentives promoting greenertransportation options.
Analysts predict that this growth trend willonly gain momentum in twenty twenty-five,
(03:59):
fueled by extended sales tax incentives forcarmakers committed to establishing
manufacturing facilities within Indonesia.
These incentives are seen as a strategic moveby the government to attract foreign investment
and boost local production, further cementingIndonesia's position as a key player in the
global electric vehicle industry.
(04:21):
However, despite the impressive sales figures,electric vehicle adoption rates in Indonesia
remain relatively low compared to neighboringcountries such as Singapore and Thailand.
The absence of home-grown four-wheel electricvehicle manufacturers in Indonesia means that
major foreign players are expected to continuedominating the market in the foreseeable
(04:43):
future.
This presents both a challenge and anopportunity for the Indonesian automotive
industry, as it seeks to develop its owncapabilities and reduce reliance on imports.
The Indonesian government's commitment tofostering a sustainable automotive industry is
evident through its policy initiatives andincentives aimed at encouraging electric
(05:04):
vehicle adoption.
As the country continues to navigate thetransition towards greener transportation
solutions, the role of Chinese carmakers andthe potential for local manufacturing will be
pivotal in shaping the future of Indonesia'sautomotive landscape.
Our final story today dives into thetransformative impact of nickel
(05:26):
industrialization on Indonesia's economy.
As the world's largest producer and exporter ofnickel, Indonesia has strategically shifted
from exporting raw minerals to industrializingits downstream mining sector.
This shift has not only reshaped the economiclandscape but also positioned Indonesia as a
(05:47):
significant player in the global supply chainfor electric vehicle batteries and stainless
steel production.
According to Energy and Mineral ResourcesMinister Bahlil Lahadalia, Indonesia's policy
on nickel industrialization has been agame-changer.
Since the policy's inception, nickel exportvalues have skyrocketed from three point three
(06:08):
billion dollars in two thousand seventeen tothirty-three point five billion dollars in two
thousand twenty-three.
This remarkable growth has attractedforty-seven point three six billion dollars in
new investment and created one hundred eightythousand six hundred new jobs, contributing
thirty-four point one billion dollars toIndonesia’s exports.
(06:30):
The government’s ban on raw nickel exports,enforced in January two thousand twenty, has
been pivotal in this transformation.
This ban has compelled foreign companies,particularly from China, South Korea, and the
United States, to invest in domestic processingand smelting facilities.
Companies like Tesla, CATL, and LG EnergySolution have shown a keen interest in securing
(06:54):
their supply chains within Indonesia,reinforcing the country's role in the electric
vehicle revolution.
Minister Bahlil highlighted that for decades,Indonesia relied heavily on exporting raw
materials, a model inherited from the Dutchcolonial era.
While this approach provided quick revenuepost-independence, it wasn't sustainable for
(07:15):
long-term growth.
The industrialization of the downstream miningsector, starting with nickel, offers a
sustainable economic trigger that could beapplied to other sectors like forestry,
fisheries, oil, and gas.
This policy shift began under President SusiloBambang Yudhoyono and was aggressively enforced
by President Joko Widodo, despite oppositionfrom Western economies.
(07:39):
Under President Prabowo Subianto, the policycontinues to expand, with a special task force
led by Bahlil overseeing its execution.
Plans to extend this industrialization approachto bauxite and tin are already underway,
promising further economic growth anddevelopment.
As Indonesia continues to harness its richnatural resources through industrialization,
(08:02):
the country is poised for substantial economicgains.
By transforming its resource-based economy,Indonesia is not only enhancing its global
competitiveness but also setting a precedentfor other resource-rich nations seeking
sustainable growth paths.
Alright that's a wrap for this episode.
(08:22):
If you enjoyed this brief, and would like tostay updated on latest episodes, don’t forget
to click ‘Follow’ in your podcast app.
Thanks again for listening, and hope to catchyou next time.
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