Asean makes push to become global EV production hub

Concluding the Asean summit in Labuan Bajo this week, President Joko "Jokowi" Widodo said the declaration marked an important step in the region’s economic cooperation.

Aditya Hadi

Aditya Hadi

The Jakarta Post


People walk past parked electric vehicles deployed for the Group of 20 Summit in Nusa Dua, Bali, on Nov. 12, 2022.(AFP/Bay Ismoyo)

May 15, 2023

JAKARTA – ASEAN leaders have agreed to cultivate the development of the electric vehicle (EV) industry in the region with hope of one day serving not just the regional market but the rest of the world as well.

The bloc’s leaders wrote in a recent declaration that they were committed to supporting the adoption of EVs and improving the state of the industry in each member state. This included creating a conducive business and investment environment.

Concluding the ASEAN summit in Labuan Bajo this week, President Joko “Jokowi” Widodo said the declaration marked an important step in the region’s economic cooperation.

“[The ecosystem] will be an important part of the global supply chain, so downstream industry is key,” the President said on Thursday.

EV use in ASEAN is lower than in countries with more developed markets for the vehicles, such as China.

Consultancy McKinsey and Company data shows that combined EV adoption in Thailand, Malaysia and Indonesia in 2021 was less than that of Japan, where 1.2 percent of vehicles purchased were electric. China led in the indicator with 16.1 percent, followed by South Korea and Australia.

Indonesia, like other ASEAN member states, has been seeking investment from EV firms for the production of electric two- and four-wheeled vehicles in the country. This includes investment in raw materials necessary for the manufacture of EVs, such as nickel and cobalt.

ASEAN has also said it will seek to create a unified standard for EVs covering technology, safety standards, charging stations and battery swapping and disposal, among other factors. Through this standardization, it hopes to facilitate trade among countries and ensure cross-border interoperability.

The agreement also contains plans to enhance the participation of micro, small and medium enterprises (MSMEs) in the EV industry, improve collaboration on human capital development and raise public awareness about EVs.

ASEAN members also plan to push for a gradual phasing-out of conventional internal combustion engine (ICE) vehicles toward EVs or similar technologies to reduce emissions from transportation.

Read also: The future and challenges of electromobility in ASEAN

At the same time, six prominent associations from five ASEAN countries signed an agreement regarding the development of EV battery technology.

They were the Singapore Battery Consortium (SBC), the Thailand Energy Storage Technology Association (TESTA), Nano Malaysia Berhad, the Electric Vehicle Association of the Philippines (EVAP) and two entities from Indonesia: the National Center for Sustainable Transportation Technology (NCSTT) and National Battery Research Institute (NBRI).

The cooperation agreement, which was signed at the ASEAN Battery and Electric Vehicle Technology Conference (ABEVTC) in Bali, aims to establish standardization and ensure safety.

“This memorandum of understanding has a purpose to conduct joint research on EV battery technology in Indonesia. We hope to work with other researchers in the ASEAN region while supporting the battery industry in their respective countries,” NCSTT director Leonardo Gunawan said on Tuesday, as quoted by Antara.

Edi Prio Pambudi, undersecretary of international economic cooperation at Office of the Coordinating Economic Minister, said Indonesia had the potential to help build the ecosystem in the region, as the country had the raw materials to produce batteries.

He said in a statement on May 6 that it was necessary for ASEAN countries to think together about building an EV ecosystem from upstream to downstream. This included finding ways for ASEAN member states to support uptake with the necessary infrastructure, especially charging stations.

“EVs are about the car, the charging station and other facilities. Of course, it is a huge task that must be done immediately,” he said.

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