Jakarta, 2 October 2024: ERIA, in association with AIG (American International Group) Global Trade Series, hosted a seminar titled Trade and Resources in Southeast Asia: Critical Materials, Semiconductors, and Industrial Policy at ERIA's office in Jakarta. The event explored the evolving dynamics of trade and industrial policy in Southeast Asia, focusing on the region's growing role in global supply chains and contributions to the energy transition and semiconductor industries.

In his opening remarks, ERIA President Tetsuya Watanabe emphasised Southeast Asia's critical role in global trade due to its vast reserves of essential minerals for batteries, semiconductors, and renewable energy. He acknowledged the need for the region to rethink its trade policies and supply chains to remain competitive amid global shifts.

Dr Rhodri Williams, Head of International Public Policy at AIG, noted in his pre-recorded remarks that the AIG Global Trade Series (GTS) is dedicated to fostering discussions on global trade dynamics and highlighting its crucial role in driving prosperity. He praised the GTS event for uniting experts to address trade challenges and expressed gratitude to President Watanabe for his leadership and support.

In his keynote address, Affan Alamudi, Senior Economic Advisor to Indonesias Minister of Industry, underscored Indonesia's pivotal role in global supply chains for critical minerals, addressing challenges such as infrastructure and skilled labour gaps. He reaffirmed Indonesia's commitment to economic growth and the global energy transition, stating that with the right strategies, the country can ensure its resources benefit both its people and the global community.

The first panel, moderated by Divya Karyza, journalist at The Jakarta Post, discussed Southeast Asia and Australias essential role in supplying critical materials for the energy transition. Dr Alloysius Joko Purwanto, ERIA Energy Economist, emphasised Southeast Asia's vital mineral reserves for the energy transition and advanced technologies, highlighting the need for reliable supply chains, reduced dependence on China, and strict sustainability standards for long-term resilience.

Dr Bimo Wijayanto, Assistant Deputy for Strategic Investment from the Office of Indonesias Deputy Minister for Investment and Mining Affairs, further discussed Indonesias commitment to sustainable mining practices, balancing economic benefits with environmental responsibilities to drive the countrys growth in the global market. Prof. Ian Satchwell, adjunct professor at the Sustainable Minerals Institute, University of Queensland, echoed these sentiments, stressing the importance of governance and environmental management to meet global sustainability goals.

The second panel, moderated by Dr Wan Seok Chang, ERIA Economist, focused on the global reconfiguration of semiconductor supply chains in Southeast Asia. Dr Jeong Hyung-Gon, Senior Research Fellow at the Korea Institute for International Economic Policy, emphasised the need for resilient supply chains amid geopolitical tensions. He noted that Southeast Asias growing importance in semiconductor production offers the region an opportunity to become a major player in global trade.

Prof. Azrul Azlan Hamzah, Principal Fellow at the Institute of Microengineering and Nanoelectronics (IMEN), Universiti Kebangsaan Malaysia, discussed Malaysias potential as a semiconductor hub, noting that investment in infrastructure and talent development is key to the countrys long-term success. Dr Alicia Garcia-Herrero, Chief Economist for Asia Pacific at Natixis, highlighted Southeast Asia's key role in the shifting global semiconductor trade and stressed the need for regional cooperation to strengthen supply chains amid geopolitical tensions. Rohit Girdhar, Vice President & Head of Strategy, Mergers and Acquisitions at Infineon Technologies Asia Pacific, underscored the importance of government support and policies that encourage private sector investment to ensure a stable supply chain for semiconductors.

The third panel, moderated by Dr Dionisius Narjoko, ERIA Senior Economist, examined the resurgence of industrial policy, drawing lessons from Europe, the US, and Japan, while addressing challenges for Southeast Asian countries in formulating their own strategies to ensure economic security. Yuta Okuyama, ERIA Policy Fellow and Chief of Staff, noted that industrial policy cannot succeed without industry involvement and international cooperation, drawing lessons from Japans balanced approach to economic security and industrial growth.

Dr Elvire Fabry, Senior Research Fellow at Jacques Delors Institute, highlighted that Southeast Asia can learn from the EU and Japan by diversifying critical material sources to strengthen supply chain resilience. Dr Rem Korteweg, Senior Research Fellow at Clingendael Institute, emphasised the importance of strategic partnerships with global allies to boost the regions role in trade. He highlighted the need for regional coordination to prevent competition and promote unified strategies for growth. Both Dr Fabry and Dr Korteweg stressed the balance between open markets and economic security.

Furthermore, Dr Yose Rizal Damuri, Executive Director of CSIS Indonesia, highlighted the need for long-term competitiveness in Southeast Asia through investment in research, infrastructure, and cross-border collaborations to strengthen industrial policies and address global competition.

In his closing remarks, President Watanabe underscored the need for continued collaboration, noting that the seminar's discussions offer valuable insights into how Southeast Asia can strengthen its position in global trade. He called for action to ensure the region not only supports but leads in securing resilient critical resource supplies and strengthening its role in the semiconductor supply chain, driving sustainable growth and economic stability.

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