[ASEAN Outlook 30th edition] Meeting Minutes of conference New Leadership in Indonesia and Thailand: Policy Impacts on Taiwan

Taiwan ASEAN Studies Center Editor Team

The New Leadership in Indonesia and Thailand: Policy Impacts on Taiwan conference, organized by the Taiwan ASEAN Studies Center of the Chung-Hua Institution for Economic Research (CIER) and supported by the Chinese National Association of Industries, successfully concluded on October 30, 2024. The conference had the honor of having Sung Shen-Wu (Assistant Director General of the Ministry of Foreign Affairs) and Kao Keng-Tsuan (Senior Supervisor of the National Association of Industry of the Republic of China) to deliver opening remarks. Presentations were made by Dr. Ke-Li Teng (Adjunct Assistant Professor at the Institute of Strategic Studies, National Defense University), Dr. Shangmao Chen (Professor, Department of Public Affairs, Fo Guang University), and Sean Lee (Research Analyst of the Taiwan ASEAN Studies Center, CIER) on the new policies and leadership in Indonesia and Thailand.

The forum had participants including Chung Kuo-Sung (CEO of jpp-KY) and Liu Chin-Cheng (Senior Manager, Sinotech Engineering Consultants, Ltd.) gathered to discuss and exchange views on the current state and prospects of Taiwan-Thailand and Taiwan-Indonesia relations. The meeting was held online and streamed live on YouTube, allowing the public to view the session later, thereby enhancing understanding of industry issues related to Thailand and Indonesia.

The event began with three presentations, followed by a panel discussion. The first presentation was by Dr. Ke-Li Teng (Adjunct Assistant Professor at the Institute of Strategic Studies, National Defense University), who spoke on Key Issues and Prospects for the New Indonesian Government After the 2024 Elections. Indonesia, being a multi-religious and multi-ethnic country, places great importance on cultural unity, mutual assistance, shared interests, and consensus-building, which are vital for its social stability. The newly elected President of Indonesia, Prabowo Subianto, assumed office on October 20, 2024, and his Vice President is Gibran Rakabuming, son of former President Joko Widodo, indicating that the new administration may continue the policies of the Jokowi administration. Key areas for the new government include infrastructure, industrial development, and food and energy self-sufficiency, particularly in infrastructure, where the Jokowi administration completed the Jakarta-Bandung high-speed rail and promoted the New Capital City project to ensure Indonesia’s long-term development.

Prabowo’s flagship pre-election promise is to provide free nutritious school lunches for primary and secondary students, though it may increase government fiscal burdens. In foreign policy, Indonesia adheres to a zero enemy principle, emphasizing neutrality in international disputes. It is expected that President Prabowo will continue this stance. Regarding relations with China, the new administration is likely to deepen cooperation based on the previous government’s policies. For Taiwan, Indonesia has become an important source of students and migrant workers since Taiwan’s implementation of the New Southbound Policy. Understanding and respecting Indonesian culture will help promote Taiwan-Indonesia cooperation, with potential areas of focus including supply chain resilience, green transformation, and digitalization.

Next, Dr. Shangmao Chen (Professor, Department of Public Affairs, Fo Guang University), presented on Key Issues and Prospects for Thailand’s Paetongtarn Government in 2024. Thailand’s economic development is closely tied to its political situation, especially at a critical moment of post-pandemic recovery. In recent years, Thailand’s political landscape has been marked by a confrontation between reformists and conservatives, leading to instability. Currently, Thailand’s political scene is divided into three major factions: the reformist People's Party (formerly the Future Forward Party), the center-left Pheu Thai Party (the current ruling party), the center-right Bhumjaithai Party and military-backed parties.

In early August 2024, a political crisis erupted in Thailand, including the dissolution of the Future Forward Party by the Constitutional Court and the dismissal of Prime Minister Srettha Thavisin by the same court. After negotiations, new Prime Minister Paetongtarn Shinawatra was elected with parliamentary support on August 16, signalling the return of the Thaksin family to politics. The new government, which took office in early September, is expected to continue many of Srettha’s policies, such as the 10,000 baht digital wallet scheme, the land bridge project, and active economic diplomacy. However, internal pressures for constitutional reform and external changes in the international political situation may undermine government stability. Paetongtarn’s father, Thaksin Shinawatra, serves as both an asset and a potential burden for her, presenting significant challenges for the new administration. On the diplomatic front, Thailand seeks to avoid taking sides in the U.S.-China rivalry and aims to exert influence within ASEAN, particularly on the Myanmar issue.

Lastly, Sean Lee, Research Analyst at the Taiwan-ASEAN Research Center, presented on Prospects for Taiwan-Indonesia and Taiwan-Thailand Relations and Economic Cooperation. Amid the global supply chain shift, countries in Southeast Asia, including Indonesia and Thailand, have become key destinations for Taiwanese businesses relocating production lines. As the largest economy in ASEAN, Indonesia aims to become one of the top five global economies by 2045. President Prabowo Subianto aims to increase the country’s economic growth rate to over 8% in the next 2-3 years. Indonesia’s economic policies will continue the downstream policy, gradually promoting the development of downstream industries, and has already implemented export bans on nickel and bauxite. Indonesia also aims to leverage its nickel resources to develop electric vehicle batteries and enter the global EV supply chain.

Thailand, the second-largest economy in ASEAN, has seen less impressive economic performance in recent years compared to other ASEAN countries, and revitalizing the economy is a major task for the Thai government. Electric vehicles have been a key focus, with Thailand aiming to become the 10th largest car producer globally and actively transitioning to electric vehicles with an ambitious 30@30 goal, where 30% of total vehicle production will be zero-carbon cars by 2030. Thailand also aims to gradually develop high-end electronics industries, such as chips and AI, through printed circuit board (PCB) manufacturing and assembly. Thailand is already the largest PCB production center in ASEAN and Taiwan’s fourth-largest overseas PCB industrial cluster. In terms of cooperation with Taiwan, areas such as supply chain resilience, industrial collaboration, tourism, education, industry talent cultivation, green and digital transformation, and others are key areas for future strengthening of cooperation.

During the forum, the panellists, along with industry representatives, including Chung Kuo-Sung (CEO of jpp-KY), and Liu Chin-Cheng (Senior Manager Zhongxing Engineering Consulting Co., Ltd.), exchanged views on Taiwan’s relations with Indonesia and Thailand, and the opportunities for industrial cooperation. Chairman Zhong shared practical experiences from his company’s operations in Thailand. In response to the Out of China trend, many Chinese companies have entered the Thai market, creating significant competitive pressure for Taiwanese businesses, particularly in the electric vehicle sector. The Thai government is considering countermeasures, but specific policies remain unclear. Chung Kuo-Sung (CEO of jpp-KY), advised Taiwanese businesses entering Thailand to focus on high levels of automation to avoid labor dependency, as automation is a market trend. He also highlighted language barriers, labor quality, and a shortage of professional talent as important challenges for investment in Thailand.

Manager Liu shared his company’s experience in Indonesia, primarily involved in public works projects funded by the World Bank (WB), the Asian Development Bank (ADB), and the Japan International Cooperation Agency (JICA). Indonesia has a high demand for infrastructure, and in recent years, there has been increasing demand for green energy. Coal-fired power plants will gradually be phased out due to international carbon reduction requirements. Indonesia is also actively promoting mass transit and railway construction, offering many opportunities for Taiwanese companies in areas like housing, waste management, sewage treatment, and water supply.

Conclusion

The New Leadership in Indonesia and Thailand: Policy Impacts on Taiwan conference successfully concluded. The Taiwan ASEAN Studies Center of CIER continues to serve as a vital platform for discussions on important Southeast Asian issues, with plans to organize further Southeast Asia Economic and Trade Promotion Platform Meetings to foster mutual exchange and understanding within Taiwan’s knowledge community on Southeast Asian topics.