“Semiconductors are about chip design; that’s microelectronics. We need strong microelectronics education to compete in the global semiconductor market… In the future, it is important for us to direct human resources toward the Golden Indonesia vision.” he stated after an economic seminar in Jakarta.

Hartarto said that, in the short term, vocational education in the country needs to be improved to produce human resources (HR) who are competent in the field of semiconductors. According to him, vocational schools are well-positioned to produce a highly technical workforce for chip production.

The government has also sought to improve vocational education by issuing regulations in the form of super tax deductions, he added. According to Government Regulation (PP) Number 45 of 2019, the super deduction tax is a tax incentive provided by the government to industries involved in vocational education programs, including research and development activities to produce innovations.

“It has been made easier because there were concerns from corporations regarding audits and others. The Minister of Finance also made the process easier, and it is hoped that it will start to be utilized,” Hartarto said.

He also said that to achieve the Golden Indonesia 2045 vision, Indonesia must continue structural transformation, increase human resources, and develop new engines of growth.

“Especially, the additional engine of growth is in the digitalization sector because Indonesia already has a digital economy framework agreement in ASEAN,” he added.

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“We talked about the president’s desire to see manufacturing in the country, and it’s something that Apple will look at,” Cook told the media after the meeting.

Widodo’s administration has worked for years to bring manufacturing to the country to power economic development, while Apple is seeking to diversify its supply chains away from China, where most of its smartphones and tablets are assembled. The company began moving some production to countries like Vietnam, and more recently India, after shutdowns to fight COVID-19 in China repeatedly disrupted the company’s shipments.

“I think the investment ability in Indonesia is endless. I think that, there is a lot of great places to invest, and we’re investing. We believe in the country,” Cook said.

The previous day, Cook met Vietnamese Prime Minister Pham Minh Chinh in Hanoi, where he said Apple plans to invest more in Vietnam and increase spending on suppliers in the Southeast Asian manufacturing hub.

“Given the slowing Chinese economy as well as the Chinese government’s ongoing efforts to squeeze out foreign companies and replace them with domestic brands, Apple wants alternatives for manufacturing,” said Chris Miller, Associate Professor at Tufts University whose work focuses on technology and geopolitics.

“It has already invested more in India and Vietnam, but it is likely looking at other partners in South East Asia to additional manufacturing and assembly operations,” Miller said. Cook’s visit to Indonesia came after Apple announced its fourth Apple Developer Academy in the country, to be located in Bali. The company first launched the program to train app developers in Indonesia in 2018, in the capital Jakarta.

Apple has no manufacturing facilities in Indonesia, but the company says it has invested Rp1.6 trillion (US$99 million) in its app developer ecosystem in the country. Widodo’s government has sought to leverage the country’s reserves of nickel and other raw materials to bring in manufacturing, banning export of raw commodities such as nickel and bauxite to oblige companies to build refineries domestically.

After meeting with Widodo, Cook also met Indonesia’s president-elect Prabowo Subianto, who is currently defense minister, in Jakarta. He’s set to take power in October. Indonesia’s minister of communication and information, Budi Arie Setiadi, said that Microsoft CEO Satya Nadella would visit Indonesia end of April.

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As the country scrambles to execute search and rescue, automakers might need to brace themselves for more impact coming from disruptions of suspended port operations till further notice. According to Statista.com, Japan imported ¥269.94 billion (US$1.78 billion) of auto parts from ASEAN last year for its domestic assembly. These automakers often source various components such as engines, transmissions, electrical parts, and body parts from Southeast Asian countries. 

In 2022, the Observatory of Economic Complexity (OEC) noted Japan imported US$7.93 billion worth of motor vehicles parts and accessories from China (US$3.38 billion), Thailand (US$831 million), Germany (US$501 million), South Korea (US$447 million) and the United States (US$423 million).

Apart from auto parts, ASEAN enjoys a trade surplus of more than US$250 billion – the majority of which are due to exports of electrical machinery. The bloc exported some US$73 billion of electrical machinery and equipment in 2021, which makes up 28% of all ASEAN exports to the US. United States also imports other electrical machinery from Malaysia (US$1.73 billion), Indonesia (US$1.05 billion) and Thailand (US$1.04 billion).

What Does It Leave The Automakers?

Ford CFO John Lawler told Bloomberg TV the incident will have a negative impact on deliveries of parts. He said Ford is looking to reroute car parts to other east coast ports and it would draw on its experience with COVID-related supply chain disruptions, but that the supply chains will inevitably be lengthened. 

“It’s a large port with a lot of flow through it, so it’s going to have an impact. We’ll work on the workarounds,” he added.

GM spokesman Kevin Kelly said GM uses the port to ship some vehicles “to select export markets”. GM exports the Chevrolet Corvette, built in Bowling Green, Kentucky, to the United Kingdom through Baltimore as one example. Kelly said GM is working with its logistics providers to find shipping options at other ports, but GM expects only a minor impact on operations.

Stellantis spokeswoman Jodi Tinson said in an emailed statement, “The Port of Baltimore is an important waterway for the automotive industry. We are initiating discussions with our various transportation providers on contingency plans to ensure an uninterrupted flow of vehicles to our customers and will continue to carefully monitor this situation.”

Port of Baltimore issued a statement giving no definite date of vessel traffic resumption, which says a lot about verticals affected. If these equipment cannot make into the US, that might just mean another episode of supply chain issues and freight price gouging. Japan has officially entered a recession  with one export sector forcefully paused, the ripple will reach ASEAN suppliers.  

Although there are other ports on the East Coast, it does not translate directly to business as usual. Port capacities would be a question in terms of port throughput, and the stranded cargo contends with waiting time or even diverting further to the West.

Kevin Linderman, Professor and Supply Chain Expert at Pennsylvania State University, said: “They will likely have to reroute shipping to other ports on the East Coast. However, this will put additional demand on these ports, and shippers may not be able to access US markets.”

Apart from auto parts, construction machinery is also affected. Reuters noted at least 40 ships are now more or less trapped inside the port, and some 30 others planned to arrive there.

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Source: Chosun.com

Southeast Asia enjoyed increasing popularity of Chinese brands, and it caused Samsung’s shipment volume and market share to decrease compared to the same period last year. Canalys’ findings revealed a total of 7.26 million smartphones were shipped in January from five Southeast Asian countries, including Indonesia, the Philippines, Thailand, Vietnam, and Malaysia. It marks a 20% increase in shipment volume compared to the same period last year.

Among these, Samsung Electronics has shipped 1.5 million units, fueled by the popularity of the Galaxy S24 series. As a result, the company has achieved a market share of 20% , securing the first rank. Samsung had lost the top spot in Southeast Asia to the Chinese company Transsion in December last year but managed to regain it within a month.

According to market research firm, Canalys, the overall economic recovery in Southeast Asia has led to an increase in smartphone demand. Rising interest in Galaxy’s AI (Artificial Intelligence) technology has been a positive factor as well. Xiaomi secured the second spot in the market with a share of 18%, followed by Transsion and Oppo, both with a share of 15%. Vivo came in fifth with 12%.

However, Samsung Electronics is lagging behind Chinese companies in terms of growth. In January, Samsung’s smartphone shipments in Southeast Asia declined by 11% year-on-year, and its market share dropped by 7 percentage points to 20% from 27% in January of the last year. 

On the contrary, Xiaomi’s shipment volume surged by 128% during the same period, and Transsion’s shipments exploded by 190%, challenging Samsung Electronics.

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Source: Jeetendra Khadan and Kaltrina Temaj, World Bank

Metal prices are expected to fall 5% in 2024, after declining nearly 10% in 2023 (y/y). They are projected to stabilise in 2025 (y/y). Key risks to these price predictions include weaker-than-expected demand from China and advanced economies or major disruptions to production. An escalation of the latest conflict in the Middle East could also disrupt trade and therefore prices. 

Subdued Global Demand
Metal demand growth slowed to 0.6% in 2023Q3 (q/q) as global manufacturing activity remained subdued. This trend aligns with the global manufacturing Purchasing Managers Index (PMI), which consistently indicated contraction throughout the year.

Monetary tightening in advanced economies weighed on consumer demand for metal-intensive durable goods. Despite a weakened property sector, demand from China’s infrastructure and manufacturing sectors, the energy transition, and optimism regarding policy stimulus to shore up economic activity supported China’s metal demand.

A Modest Recovery In Metals Supply Also Weighed On Prices

Metal output increased in the first three quarters of 2023 (y/y), following production disruptions in 2022. Nickel production grew 15% for the period January to September 2023 (y/y), with increasing supply coming mainly from Indonesia, the world’s largest nickel producer.

Even with production disruptions in Chile in early 2023, which is the world’s largest copper producer, global copper production rose by 7% for the same period in 2023 (y/y). This growth is attributable to capacity expansions in other major producers, including China and the Democratic Republic of Congo.

On the other hand, production growth of energy-intensive metals, such as aluminum and zinc, remain subdued as major European smelters have not fully recovered following closures in 2022 due to high energy costs.

Metal Prices Are Forecast To Fall By 5% In 2024, Before Stabilising In 2025. 

The World Bank’s Metal Price Index is expected to fall 5% in 2024. Among various metals, the largest price decline is expected in nickel, followed by aluminum, tin, zinc, lead and copper. Prices are expected to inch up in 2025, with price increases ranging from 2% for lead to 9% for aluminum. 

The Price Outlook Is Subject To Several Risks

The primary downside risk to the price forecasts lies in a sharper slowdown in activity among advanced economies and China, which could further weaken metal demand in 2024. Trade restrictions and other policy actions, such as sanctions on Russia and China’s impending aluminum cap, could tighten metals supply and push up prices.

An escalation of ongoing conflict in the Middle East could lead to substantial disruptions in energy markets, increasing production costs for energy-intensive metals. Other short-term risks include environmental concerns, labor disputes, adverse weather conditions, or technical problems can disrupt mining operations and adversely affect the supply of metals in several regions, especially Africa, the Americas, Australia, and Indonesia. In the longer term, an accelerated energy transition would further support prices of some base metals—notably aluminum, copper, nickel, and tin. 

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Source: Manufacturing Asia

More Asian countries have doubled down on their efforts to claw a top spot in the EV scoreboard. The usual suspects like China, Korea, India, Indonesia and Thailand are already in the marketplace vying for consumers’ attention in terms of charging stations availability and service accessibility. Adding insult to injury is Tesla’s losing its reign as world’s best-selling electric vehicle manufacturer.

Euromonitor International’s findings revealed China was 7th in 2023’s EV Readiness Index, rising 7 places from 2022, attributed to high investments into public charging infrastructure. The economic giant continues to be the largest EV market accounting for 61% of all the sales globally in 2023. It is also home to 1.8 million public charging stations, or about 65% of global supply. 

“China has seen a swift rise in fast charging stations, providing charging power of more than 22kW, which has helped fuel greater consumer confidence in buying an EV,” said Fransua Vytautas Razvadauskas, Insights Manager for Mobility at Euromonitor.

Following closely behind is South Korea which jumped 10 places to rank 8^th. The report also noted new growth opportunities for EV makers in emerging Southeast Asian nations, including Indonesia whose government recently rolled out incentives to boost domestic EV and battery production. Thailand has also stepped up with tax perks boosting EV sales, coupled with the influx of cheap cars from China. 

“Competition in emerging EV market economies is expected to increase, with the Asia Pacific region offering the most opportunities. Despite the infrastructure constraints, EVs will continue to gain market share, benefiting from government incentives, rising consumer incomes and expanding car ownership,” Euromonitor added.

The intelligence firm also highlighted India being one of the fastest growing EV markets in Asia as the country’s sales of electric cars is projected to skyrocket by 50% in 2023. Its government also rolled out a subsidy scheme to ramp up domestic EV manufacturing and attract investments in the sector.

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“AI-based programming activities need to be predicated on the ethics governing its use and development,” according to the draft produced by Indonesia’s communications ministry.

The draft said the guidance was needed to mitigate all “impacts and losses” that may occur from the use of AI, and recommends developers prepare a risk management strategy should “AI use disasters occur”, and prepare reporting and recovery mechanisms from such incidents.

It did not elaborate on the type of losses or disasters from AI use. The ethics guidelines also include privacy protection and humanity, adding that the use of AI, including development of AI products and marketing, needs to bolster innovation and does not replace human existence.

Usman Kansong, a Senior Communications Ministry official who authenticated the draft, said he does not know when it would be issued, but its deputy minister was quoted by local media Tempo as saying that he hopes it will be out this month.

The guidance may precede a “business-friendly” regulation among Southeast Asian countries, which asks companies to take countries’ cultural differences into consideration and warns of the risks of AI being used for misinformation. Sources told Reuters this regulation is expected to be finalised soon.

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China has consistently held the position of ASEAN’s fifth largest FDI investor, following the US, ASEAN itself, Japan, and the European Union. However, western multinational corporations (MNCs) are crucial in driving investment in ASEAN, as they diversify supply chains and implement the China+1 strategy.

The China Plus One strategy does not necessarily mean companies are moving away from China altogether. Instead, they are diversifying their operations and establishing a presence in additional locations while still maintaining their manufacturing or sourcing activities in China. 

Popular destinations for companies implementing the China Plus One strategy include other countries in Southeast Asia, such as Vietnam, Thailand, Malaysia, and Indonesia, which offer lower labour costs and attractive investment incentives. These countries have seen increased FDI as a result of companies seeking to complement their operations in China.

China’s outward direct investment (ODI) into ASEAN recorded a compound annual growth rate (CAGR) of 13.5% between 2013 and 2018, followed by a continued rise of 8.0% between 2018 and 2022. ODI flows into ASEAN reached an impressive US$18.7 billion in 2022, contributing 11% of China’s total ODI.

The Breakdown

Going by geography and industry, Singapore and Indonesia were top destinations for Chinese ODI, with the manufacturing sector dominating. Singapore attracted the highest investment flow of a cumulative US$ 33.9 billion between 2018 and 2022, followed by Indonesia at US$ 15.2 billion during the same period. Strong growth rates were observed across Indonesia, Thailand, and Vietnam, with 10-25% CAGR.

By industry, manufacturing sector drew the largest investment amounting to US$ 33.3 billion over the past five years. Subsequently, wholesale and retail trade received US$ 14.7 billion. Strong growth rates of 10-20% CAGR were observed in manufacturing and electricity and gas sectors. In addition, the information and software sector witnessed a sizeable 50% growth.

Volume of outward FDI flows from China to ASEAN countries in 2022, by sector (in million U.S. dollars)
Source: Statista.com

Data from Statista.com revealed in 2022 alone, China’s outward FDI flows to the manufacturing industry in ASEAN countries reached around US$8.2 billion. DBS’ research added Indonesia remains the primary investment destination, while Malaysia is emerging as a new destination for strong growth. 

Notably, Indonesia saw nearly a 400% increase, reaching US$ 5.3 billion in H1 2023. Investment in Malaysia more than doubled, amounting to US$ 1.6 billion in H1 2023. Vietnam also maintained its steady upward trajectory, reaching US$ 530 million.

The manufacturing sector remains a hotspot for Chinese investment this year. For instance, Shandong Xinhai and BaoWu committed US$ 1.3 billion to establish a ferronickel processing facility on Sulawesi island in partnership with Vale Indonesia.

Zhejiang Huayou Cobalt invested US$ 2.4 billion in partnership with Ford and Vale Indonesia to supply high-quality nickel for electric vehicle batteries. Meanwhile, automotive giants like Zhejiang Geely and BYD strategically invested in Malaysia and Vietnam to expand their car production bases. In addition, the alternative energy and construction sectors also saw a notable rebound in Chinese investment.

According to the China Going Global Investment Index compiled by Economist Intelligence (EIU), ASEAN has made a significant leap in its ranking this year. Among the 80 major investment destinations, Singapore tops the chart as the most attractive destination for Chinese investors, with Indonesia following closely in the 2nd position, Malaysia in 3rd, Thailand in 5th, and Vietnam in 6th.

Key Sectors Chinese Investors Are Expected To Focus On In The Coming Decade

Electronics
China dominates global production of mobile phones, PCs, and various other consumer electronics products; contributing to 80-90% of the global iPhone assembly. Major manufacturers within the global electronics supply chain are expected to strategically diversify their production facilities after Covid.

This diversification will involve not only the western electronics manufacturers based in China but also the Chinese manufacturers. Among Apple’s top 200 suppliers in 2022, more than 40 were Chinese companies based in mainland China.

On the demand side, the acceleration of digitalisation process after Covid is expected to generate rising demand for various electronics devices and components within ASEAN. This encompasses a continued rise in smartphone penetration rates, establishment of smart factories, planning and construction of smart cities, among others.

Vietnam, with its well-established production network, particularly in the smartphone domain, is expected to remain a preferred investment destination in the electronics sector for Chinese firms. Other ASEAN countries like Malaysia and Thailand, which possess electronics manufacturing capabilities, also hold potential to attract Chinese investment within this sector in the coming years. It is also useful to note Vietnam is now actively doing what it can to qualify as a semiconductor manufacturing hub to support the electronics sector.

Electric Vehicles (EVs)
China currently dominates the downstream global EV supply chain, including a 50-70% share in certain material processing, 70% in EV battery production, and 50% in EV production. The upstream EV supply chain, particularly mining, is dominated by the resources-rich countries like Australia, Indonesia, and Congo.

Indonesia’s embargo on nickel ore exports in recent years has triggered realignments in the EV supply chain. Chinese firms have been compelled to localise their processing facilities for EV metals in Indonesia to secure the supply of nickel resources. It is possible that ASEAN countries may introduce similar protective measures on critical minerals in the future, to further encourage supply chain localisation.

Meanwhile, Chinese EV manufacturers are eyeing the ASEAN market, due to its promising demand prospects. EV adoption in ASEAN remains nascent compared to China, with EV sales constituting 1-10% of new vehicle sales.

ASEAN countries are introducing strategic policy measures to accelerate EV adoption, ranging from tax incentives, subsidies for EV purchases, to the facilitation of EV charging infrastructure. Singapore, Thailand, and the Philippines have set ambitious targets of achieving a 100% EV adoption rate by 2030-2040 — presenting significant opportunities for Chinese EV manufacturers looking to tap overseas markets for expansion.

Renewable Energy
Investment in renewable energy is expected to align closely with the global push for decarbonisation. In response to this imperative, the Chinese government is actively promoting the transition of State-Owned Enterprises (SOE) overseas investment within the BRI framework, moving from the traditional coal and mining activities towards renewables projects.

Meanwhile, the ASEAN region, endowed with abundant natural resources including wind, hydro, and solar power, holds substantial technical potential for renewable energy expansion. The majority of ASEAN countries are aiming to achieve a 30-40% share of renewables in their power generation mix by 2030-2035. This underscores substantial demand for renewables investment in the years ahead.

Technology, Media And Telecommunication (TMT) Services
Investment in TMT services will be influenced in part by policy and regulatory changes. Chinese internet, fintech and other private enterprises in the TMT services sector are facing challenges due to the complex regulatory environment in China’s domestic market, and stricter investment scrutiny in the US. As a result, they are exploring opportunities in the ASEAN market more extensively.

In the manufacturing sector where Internet Of Things (IoT) gets increasingly common, downtime and enhanced efficiency have become imperative staples to beat competition. That is also where the industry witnesses many players offering solutions such as easy accessibility and servicing 24/7 for machine shops, evangelising the importance of predictive maintenance. 

According to a collaborative report by Google, Temasek, and Bain & Company, Southeast Asia’s digital economy will surge from US$ 200 billion in 2022 to US$ 600 billion -1 trillion by 2030. Emerging markets like Indonesia and Vietnam are poised for substantial growth in this sector. Singapore, with its role as a regional investment and financing hub in the TMT startup domain, stands to benefit as well.

China’s ODI underscores ASEAN’s growing appeal, with the republic consistently ranking as ASEAN’s fifth largest FDI investor. While western multinational corporations play a pivotal role in driving investment, the China Plus One strategy has emerged as a nuanced approach.

Rather than a complete shift away from China, companies are strategically diversifying their operations. Southeast Asian countries like Vietnam, Thailand, Malaysia, and Indonesia have become favoured destinations with lower labour costs and attractive incentives. The sustained growth in China’s ODI into ASEAN, with a notable 11% contribution to China’s total ODI in 2022, signifies the enduring partnership and the evolving dynamics of economic collaboration between these two influential regions.

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Southeast Asia’s manufacturing sector continued to contract in October as new businesses slump for two months in a row, an industry survey by S&P Global showed. The headline ASEAN manufacturing purchasing managers’ index (PMI) remained unchanged at 49.6 last month, signaling marginal deterioration in the overall health of the sector, according to S&P. 

The headline figure dipped below the neutral mark of 50.0, which separates contraction from expansion, for the second month running as five of the seven ASEAN nations surveyed posted contraction in October 2023. Malaysia remained the hardest hit with an unchanged PMI of 46.8 in October that marked its fourth consecutive months of shrinking factory activity. This was followed by Thailand (47.5) and Singapore (48.6), while the downturn was relatively softer in Myanmar (49) and Vietnam (49.6). 

Indonesia and the Philippines were the only nations that saw their local manufacturing industries improve in October with a headline PMI of 51.5 and 52.4, respectively. S&P traced the region’s extended manufacturing slump to declining new orders and a sustained slowdown in output. This prompted factories to cut back on their buying activity for the first time in over two years, draining their inventories.

“If demand continues to soften, we could see manufacturers reducing their output in the coming months,” said Maryam Baluch, economist at S&P Global Market Intelligence.

On a positive note, the market slowdown helped temper inflation as seen in costs of input materials and output prices rising at muted rates. ASEAN manufacturers remained optimistic that production will continue to grow in the coming year despite weakening market conditions. The level of confidence, however, was lower than historical average.

“Global economic headwinds continue to cloud the outlook, including the subdued economic recovery in China and the lagging effects of monetary policy tightening across the majority of the ASEAN constituents and elsewhere,” Baluch said.

S&P Global said Malaysian manufacturers experienced a challenging business environment again at the start of the final quarter of 2023 as demand conditions continued to wane. It noted that new orders moderated and production was scaled back. Employment also eased, but firms were still able to deplete backlogs of work to the greatest extent since the survey began in July 2012.

As at 16 November 2023, the ringgit reportedly closed easier against the US dollar as the greenback rebounded from an over two-month low earlier this week on the back of a stronger-than-expected US retail sales data. 

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Source: Masdar 

The inauguration was held in the presence of: Joko Widodo, President of the Republic of Indonesia; Arifin Tasrif, Indonesia’s Minister of Energy and Mineral Resources; Dr. Thani Al Zeyoudi, UAE Minister of State for Foreign Trade; Erick Thohir, Indonesia’s Minister of State Owned Enterprises; Mohamed Jameel Al Ramahi Chief Executive Officer of Masdar, and Darmawan Prasodjo, Chief Executive Officer of PLN Group.

Cirata is Masdar’s first floating PV project and its first renewable energy project in the Southeast Asian market. Built on a 250-hectare plot of the Cirata Reservoir, in the West Java province, it will power 50,000 homes and offset 214,000 tons of carbon dioxide emissions.

Masdar and PLN NP recently signed an MOU to develop Phase II of Cirata with up to 500MW additional capacity, following a regulatory development from the Ministry of Public Works and Housing in Indonesia that that has increased the portion of water that can be covered, for renewable energy uses, to a maximum of 20%.

Image credit – Masdar

Dr. Sultan Al Jaber, said, “The inauguration of this floating solar PV plant at Cirata is a testament to Masdar’s pioneering ethos, our innovative spirit and power of partnership.With just a few days to go before COP28 in the UAE, it is exciting to see tangible progress being made on further ramping up of renewables capacity as we collectively seek to deliver unified action on climate change that will work for all parts of the world.”

Mohamed Jameel Al Ramahi, added, “The inauguration of Cirata demonstrates Masdar’s commitment to developing cutting-edge technologies to provide world-class solutions. We are delighted that the development of our first floating solar plant with PLN Group is fully operational and supporting Indonesia’s renewable energy objectives. In October 2023, Masdar and PLN Group agreed to triple the existing capacity of this already record-breaking project, supporting Indonesia’s decarbonization and net-zero ambitions.”

Indonesia is a key strategic market in Southeast Asia for Masdar where the UAE’s clean energy powerhouse has an expanding portfolio of interests. In addition to Cirata, Masdar entered the geothermal energy sector through a strategic investment in Pertamina Geothermal Energy (PGE) in February 2023. Masdar also opened an office in Jakarta in 2021 to further strengthen links with key players within the region.

Indonesia has plans to increase its renewable energy mix and pledged to reach net-zero emissions by 2060 or sooner. The Southeast Asian nation has committed to a 29% reduction in greenhouse gas (GHG) emissions by 2030. Ahead of COP28, to be hosted in the UAE later this year, the expansion agreement demonstrates the UAE’s commitment to supporting countries around the world with their decarbonization plans for a cleaner, greener future.

Scaling up renewables could save Indonesia, the largest energy user in the Association of Southeast Asian Nations region, as much as US$51.7 billion per year when the impacts on air pollution and climate change are included, according to the International Renewable Energy Agency. 

Floating solar plants are attractive to countries like Indonesia with expanding populations and scarce land resources. They provide higher solar panel efficiency and productivity due to the close proximity of the panels to the water surface that helps cool them. Floating panels also reduce evaporation, saving fresh water for drinking and irrigation purposes. 

For a coal reliant nation, this is certainly a step in the right direction. It also opens news markets for the metalworking sector especially for:

1. Frame Fabrication: Metalworking machines like CNC (Computer Numerical Control) routers, milling machines, and cutting equipment may be used to fabricate the metal frames that hold the PV cells, glass cover, and other components of a solar panel. These frames are typically made of aluminum or steel.
2. Tabbing and Interconnection: Some solar panels use metal ribbons or wires to connect the individual solar cells within the panel. These ribbons or wires may be attached using soldering machines or other metalworking equipment.
3. Encapsulation: Solar panels are often encapsulated in a polymer-based material, typically ethylene-vinyl acetate (EVA). The encapsulation process may involve using metal heating elements or tools to seal the edges of the solar panels.

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