Growth In Southeast Asia Research Articles

Digital Transformation for Economic Growth and SDG 8 Alignment in Southeast Asia: a Bibliometric Analysis and Systematic Literature Review with ADO-TCM Framework

Objective: This study investigates the role of digitalization in fostering economic growth and sustainability among Southeast Asian companies, aiming to map research gaps and explore future research directions while aligning with SDG 8, which promotes inclusive, sustainable economic growth. Theoretical Framework: The study employs PRISMA and utilizes the ADO-TCM framework to analyze the antecedents, decisions, and outcomes of digital transformation in the region. Method: A bibliometric analysis and Systematic Literature Review (SLR) were conducted on 165 articles from Scopus (2013–2023), categorized using the ADO-TCM framework. Results and Discussion: The findings identify key drivers of digital transformation, including government policies and Industry 4.0, with strategic decisions focusing on digital infrastructure, agility, and stakeholder engagement. Outcomes include improved sustainability, competitiveness, and digital skills. The study highlights research gaps in under-explored industries like the blue economy and agriculture, as well as inconsistencies in methodologies. Research Implications: Policymakers should support SME digitalization through improved infrastructure to drive business sustainability, create jobs, and reduce poverty, contributing to SDG 8. Future studies should explore neglected industries using mixed-method approaches. Originality/Value: By combining the ADO and TCM frameworks, this study offers novel insights into digital transformation and its alignment with SDG 8, providing practical and theoretical value for sustainable growth in Southeast Asia.

ASEAN's Role in Enhancing Regional Security and Economic Stability through Defense Cooperation

The role of ASEAN in strengthening regional security and economic stability through defense cooperation is becoming increasingly pivotal in response to evolving global geopolitical and economic challenges. This study employs a qualitative methodology, specifically a literature study approach, to analyze ASEAN's mechanisms for fostering defense collaboration and their impact on the region's stability. Central to this analysis are key initiatives such as the ASEAN Defence Ministers’ Meeting (ADMM) and ADMM-Plus, which have enhanced regional security through joint military exercises, intelligence sharing, and maritime security efforts. These initiatives have been instrumental in mitigating tensions, particularly in contested areas like the South China Sea, safeguarding critical trade routes, and promoting economic resilience. The findings indicate that ASEAN's defense cooperation directly supports economic stability by fostering a secure environment that encourages foreign investment, intra-ASEAN trade, and infrastructure development. However, the study identifies significant challenges, including disparities in member states' defense capabilities, limited inter-state trust, and a tendency to prioritize arms modernization over institutional collaboration. Moreover, ASEAN faces the growing need to address non-traditional security threats, such as cybercrime and terrorism, which require adaptive strategies and enhanced cooperation. The research concludes that while ASEAN’s defense collaboration bolsters military preparedness, it also significantly contributes to political stability and economic growth in Southeast Asia. To sustain and amplify these benefits, ASEAN must address existing challenges through measures such as enhancing transparency, fostering trust among member states, and investing in capacity-building initiatives.

The Nexus Between Financial Stability and Economic Growth in Southeast Asia

AbstractFinancial stability is an important part of economic growth. The main objective of this study is to analyse how financial stability (using Bank Z-Score) affects economic growth. The data used is country-level data from five selected Southeast Asian countries (Indonesia, Cambodia, Malaysia, Philippines, and Thailand) for the period 2011 – 2021 using the ARDL model approach. The results of this study found strong evidence that financial stability (banking stability) has a positive effect on economic growth for countries in the Southeast Asian region. This study also reveals that it is not only important financial stability variables to achieve economic growth, but investment and trade openness must also be increased if the country is to achieve its expected economic growth. A positive correlation between investment and trade openness suggests a potential for these factors to contribute to economic growth synergistically. Keywords:Financial Stability, Economic Growth, Bank Z-Score, ARDL

Will Southeast Asia be the next global manufacturing hub? A multiway cointegration, causality, and dynamic connectedness analyses

We propose a novel framework to examine relationships among drivers of economic growth in Southeast Asia, a region poised to become a significant manufacturing destination. However, unbalanced economic growth among countries poses risks to multinational companies considering offshoring decisions. Our two-stage framework uses multi-way cointegration analysis and a vector error correction model (VECM) to investigate critical drivers of economic growth. We apply a QVAR model to evaluate dynamic connectedness and spillover effects of offshoring decisions. Using World Bank data, our results show that Southeast Asian countries are interconnected through complex relationships featuring multi-way cointegration and dynamic connectedness, informing evidence-based policy.

Factors Influencing Green GDP Growth in Southeast Asia: The Role of Foreign Direct Investment, Trade Openness, and Economic Development

Factors Influencing Green GDP Growth in Southeast Asia: The Role of Foreign Direct Investment, Trade Openness, and Economic Development

Analysis of the Design Planning for the Special Economic Zone: Nongsa Digital Park as a Digital Hub

Nongsa Digital Park is a Special Economic Zone in Batam, Riau Islands, with a focus on the digital and tourism ecosystem. Its strategic location near the Singapore border presents an opportunity to develop the digital sector in Indonesia’s maritime region. The competition among ASEAN Special Economic Zones makes Nongsa Digital Park unique. The purpose of this study is to propose a planning concept for the development of the Special Economic Zone, Nongsa Digital Park, as a Digital Hub with potential for growth in Southeast Asia. This study employs qualitative methodologies, including interviews, observations, and visual analysis using Google Earth. It analyzes the policy framework of Nongsa Digital Park as a Digital Hub. Upon further investigation, this Special Economic Zone is supported by central government policies and spatial planning alignment. The zone has the potential for expansion due to the increasing demand for data centers and digital businesses.

Rapid Socioeconomic Growth in Southeast Asia: Evidence From Nighttime Light Observations

Rapid Socioeconomic Growth in Southeast Asia: Evidence From Nighttime Light Observations

Indonesian Model of Foreign Direct Inverstment (Omnibus Law)

Foreign direct investment (“FDI”) has become a hot topic in board meetings all over the world as modern businesses are seizing new opportunities within theglobalized economy. The modern economy functions ona larger scale than ever before, and companies are beginning to realize that failing to partake in foreigndirect investment could lead to their demise. FDI has been a key factor driving export-led growth in Southeast Asia. This research offers a comparative legal and critical analysis of the Foreign Direct Investment Regulation (FDI) and strategies of attracting FDI in Indonesia by learning from Singapore. Indonesia has been striving to attract FDI, and therefore on October2020 Indonesia ratified the Omnibus Law on JobCreation replacing 79 acts regarding investment. Nevertheless, this law has raised legal controversies andpublic protests. This research focuses finding a model ofFDI attraction for Indonesia through lessons learnedfrom Singapore in terms of how to attract FDI. Singapore have made remarkable FDI accomplishmentthrough their own ways. The result of this research isaims to deplore the reasons for the accomplishment, intending to find a better model for Indonesia than theOmnibus Law currently adopted. This research arguesthat Indonesia should reconsider the Omnibus Law approach by referring to the lessons learned from theexperience of Singapore’s success in attracting FDI.

THE METAVERSE IN SOUTHEAST ASIA: TEETHING PROBLEMS

The article illustrates salient features of the Metaverse-related developments in Southeast Asia seen through the prism of major regional consumption trends, as well as the evolution of the Metaverse around the world. Starting from an outline of determining factors behind the consumption growth in Southeast Asia, the paper proceeds to specifying reasons behind the popularity of the Metaverse across the world in general and the Asia-Pacific region in particular. Then the study turns to the evolution of the Metaverse in Southeast Asia with a special focus on the gaming industry. The author argues that although obstacles to the Metaverse development are in place and will probably remain serious, its regional prospects are generally positive. The paper extends the focus on previous research on the Metaverse and consumption trends in Southeast Asia that have been carried out in a fragmented manner. As the topics discussed in their synergy have not been in a research focus in Russia and other countries, the study takes a considerable step forward in developing an integral approach to the digital transformation of social, economic and commercial processes in Southeast Asia, which accounts for its relevance, novelty and originality.

DAMPAK HEALTH CAPITAL TERHADAP PERTUMBUHAN EKONOMI: PEMBUKTIAN DARI NEGARA TERPILIH DI ASIA TENGGARA DENGAN PENDEKATAN MODEL AUTOREGRESSIVE DISTRIBUTED LAG (ARDL)

The purpose of this study is to analyze the long-term impacts of health capital on economic growth in Southeast Asia from 2000 – 2021. This study employed the autoregressive distributed lag (ARDL) model to estimate the long-run and short-run nexus among the variables. Furthermore, FMOLS, DOLS and CCR were used for a more robust examination of the empirical findings. The results of this study show that health capital (proxy by health expenditure per capita) has a long-run relationship with economic growth (proxy by GDP per capita) and its impact on economic growth is positive and significant, this implies that an increase in the health expenditure per capita will increase GDP per capita. In addition, the error correction term (ECT) estimation result is negative and significant (-1,395) implying disequilibrium of short-term shocks in the previous year will experience a long-term balance adjustment in the current year with average speed of 139,5% per year

The Impacts of Social and Economic Determinants on Poverty: An Empirical Study on Southeast Asia

The article attempted to examine the influences of social and economic determinants on poverty in seven Southeast Asian countries, namely Lao PDR, Malaysia, Myanmar, the Philippines, Thailand, Timor-Leste, and Vietnam, between 1996 and 2013 using a panel dataset. It was empirically found that the average GDP per capita and Gini index contributed to poverty reduction in Southeast Asian countries. The results also addressed that the population and poverty gap had positive impacts on the rate of the poverty headcount in the region. Policies were recommended to accelerate economic growth, reduce poverty, and achieve sustainable development in Southeast Asia. First, economic growth should be fostered since it assists in reducing poverty in Southeast Asian countries. Second, although the growth of population provides the labor forces to the economy, population growth in Southeast Asia should be carefully controlled since it increases poverty in the region. Third, an increase in the number of rich inhabitants in the society should be encouraged because it can mitigate poverty in the region. Finally, policies in redistributing income as well as in narrowing down income inequality in each society should be considered by the governments because these contribute to poverty reduction in the region.

The interrelationships between bank profitability, bank stability and loan growth in Southeast Asia

The purpose of this study is to examine the relationship between bank profitability, bank stability, and loan growth may exist in Southeast Asia, including a sample of 79 listed banks in five countries in Southeast Asia (ASEAN-5) from 2006 to 2019. Using a simultaneous equations model (SEM) with the generalized method of moments is used to examine the links bank profitability, bank stability and loan growth. The findings show a two-]way relationship between these variables. More specifically, bank profitability and stability are positively related. Bank stability and loan growth are inversely connected. Furthermore, the findings demonstrate that bank profitability and loan growth are positively related. These findings, however, suggest a trade-off in banks’ pursuit of large loan growth. Our findings, however, have implications for bank supervisors, policymakers, and bank managers.

Threat of Corruption to Foreign Direct Investment and Economic Growth in Southeast Asia

This research aims might look into the dangers caused by corruption against foreign direct investment in Southeast Asia by using the supporting variables the investment of foreign direct in the shape like the economy expansion, data technology, also Trade Openness. The scope used in this study includes 2010 to 2020 using panel data, using annual data. The data used are data from Foreign Direct Investment that enters ASEAN countries, percentage data of internet users as an indicator of ICT, corruption perception index (CPI) as an indicator of perceptions of corruption, GDP (gross domestic product) data for indicator to the economic growth, and ratio data. International trade is an indicator of Trade Openness. The PLS technique testing procedure is initiated using construction by reconstruction incorporated into the PLS calculation. We found that the Increased of foreign direct investment (FDI) are indication by the international trust level in a country, including a reflection of financial transparency supported by information and communication technology. Financial transparency is reflected in the corruption perception index. Economic prospects as reflected in economic growth or GDP growth and trade openness. The better technology of information and communication, the higher the growth of economic and trade openness at the Southeast Asia region, and the more the growth of FDI in the Southeast Asia region. And conversely, the higher the level of corruption as reflected in the corruption perception index (CPI), the more depressed the growth of foreign direct investment at Southeast Asian region.

How did Tokopedia assist economic recovery through the MSMEs during the Covid-19 pandemic?

<p>Discussing business during the Covid-19 pandemic is very interesting, especially about the acceleration of digitalization transformation in the country. Indonesia is predicted to have a high potential for digital economic growth in Southeast Asia. Online retail stores or e-commerce are part of the digital economy ecosystem growing rapidly in Indonesia. Tokopedia is an e-commerce technology company from Indonesia that has a mission to equalize the digital economy. This mission is in line with the Indonesian government, seeking to accelerate digital transformation, especially for local MSMEs (Micro, Small, and Medium Enterprises) as one of the drivers of the economy, especially during the Covid-19 pandemic. With the dominance of sellers from local MSMEs, Tokopedia contributes to the movement of the economy in Indonesia. Therefore, in addition to discussing the e-commerce digital economy ecosystem in Indonesia, this article aims to discuss Tokopedia's strategies in helping Indonesia's economic recovery during the Covid-19 pandemic through the digitalization of MSMEs. Tokopedia's series of strategies to digitize MSMEs provide inspirational stories to always be active in developing creative and innovative ideas in business processes.</p>

FDI in the ASEAN States: The Engine that Roared

executive summary: This essay examines how Southeast Asia's economic fortunes are at risk as the climate for trade and investment sours. main argument FDI is the engine that has propelled economic growth in Southeast Asia over the last few decades. The region, grouped together as ASEAN, has astutely used foreign investment and know-how to upgrade technology and skills and to transition from a low-cost manufacturing model to high-value goods and services. This openness to trade and investment has transformed the region's economic fortunes, with front-runners such as Singapore, Vietnam, Malaysia, Cambodia, and Thailand at the vanguard of global manufacturing in fields as diverse as electronics, automobiles, pharmaceuticals, and textiles. ASEAN's success as a manufacturing hub would not have been possible without both an openness to trade and the presence of regional supply chains that favorably position Southeast Asia as an essential supplier of raw materials and key components for final assembly in China. But this defining economic model is confronting headwinds that could upend its continued success. The region's policymakers face a difficult set of challenges as they navigate an increasingly disruptive external and internal landscape. policy implications • ASEAN is at the epicenter of growing trade and geopolitical tensions between the U.S. and China, which raises the threat of decoupling and supply chain reconfiguration and potentially places the region in a difficult position of having to take sides. • Deglobalization and reshoring also pose a risk to manufacturing and investment, which ASEAN states depend on. Protectionist policies are resurging in Europe and the U.S., and the Covid-19 pandemic highlights the fragility of just-in-time supply chain management, encouraging instead a just-in-case approach. This will test the region's ability to sustain its high pace of economic growth to meet rising public aspirations and concerns about stalling social mobility. • Southeast Asia is already facing climate-related devastation due to rising ground temperatures and sea levels. The region is challenged to adjust its economic model to build a more sustainable future.

Islamic finance and economic growth nexus: an empirical evidence from Southeast Asia using dynamic panel one-step system GMM analysis

PurposeThis paper aims to empirically explore the nexus between Islamic finance and economic growth across Southeast Asia based on the perception of the endogenous growth model.Design/methodology/approachThis paper applied the dynamic panel one-step system GMM as an optimum estimation approach to study the influence of Islamic finance on economic growth in Southeast Asia from 2013Q4 to 2019Q4. This paper used total Islamic financing as the major exogenous explanatory factor inside the endogenous growth model, whereas the gross domestic product was used as the measurement of economic growth. The sample consisted of all complete Islamic banks operating in Southeast Asia (Malaysia, Brunei Darussalam and Indonesia).FindingsThe findings demonstrated that Islamic finance is promoting economic growth in Southeast Asia, which reflects the weighty role of Islamic finance as an energetic contributor to economic growth.Practical implicationsThis paper would enrich the literature by studying the nexus between Islamic finance and economic growth in Southeast Asia based on the perception of endogenous growth model, as the results of this paper assist as an attendant for financial scholars, decision-makers and policymakers to expand Islamic finance globally as an alternative funding source for the best involvement to economic growth.Originality/valueDespite the existing studies on the nexus between Islamic finance and economic growth, this paper is the first that explores empirically the nexus between Islamic finance and economic growth in Southeast Asia based on the theoretical background of the endogenous growth model to obtain solid information on this nexus.

The Elasticity of Health Expenditure on Agricultural Productivity Growth in Southeast Asia

Background: Recently, agricultural productivity growth has experienced a sharp downward turn across the countries of Southeast Asia partly due to population aging, increasing pace of urbanization, and industrialization.
 Objective: To provide empirical evidence to the elasticity of prevailing health spending as a proxy of human capital stock on agricultural productivity growth in Southeast Asia.
 Methods: This study analyses data obtained from the World Development Indicators for 2000-2016 using panel data regression models.
 Results: The empirical evidence suggests that prevailing health expenditure, though statistically significant, exerts a strong positive effect on agricultural productivity growth. Therefore, a unit rise in prevailing health spending relative to GDP would increase agricultural productivity growth by 28% across countries of Southeast Asia, all else constant.
 Conclusion: The trend of rapid agricultural productivity declines in Southeast Asia could be altered by augmenting investment to the prevailing health spending as an indicator of human capital stock.
 Policy implications: The governments of Southeast Asia should increase investment in prevailing health spending relative to GDP, to stimulate more growth in agricultural productivity, greatly improved human capital stock, and eventually increase economic growth.

The impact of merchant and mobile payments on financial inclusion in Asia-Pacific

Financial inclusion is one of the biggest impediments to growth in South-east Asia. Access to financial products or even financial institutions is very limited in some countries, constraining both individual and company access to capital. This phenomenon has only intensified during the COVID-19 pandemic, and is especially problematic for those individuals and companies with largely offline businesses. This paper argues that the roots of change are starting to take hold, as payment service providers and business-to-business players are helping bridge the digital divide. Payments services are increasingly likely not to be standalone products, but rather to include a myriad of both financial and non-financial products and services that can help individuals and companies increase their economic empowerment.

NONGSA DIGITAL PARK (NDP) INVESTMENT AS A COOPERATION IN THE DIGITAL SECTOR BETWEEN SINGAPORE AND INDONESIA IN BATAM

The digital economy is growing rapidly in the era of globalization in line with the advancement of the internet and technology. In the digital world, all economic sectors become connected, so that all countries strive to develop innovation through technological adaptation to take advantage of the opportunities of the digital economy. The digital sector greatly affects other economy sectors and will be an asset in the future. Investment in the digital sector requires improving resource capabilities and developing new and greater information technologies. Singapore is currently classified as advanced which means it has a very high adoption rate of technology and information, but has limited domestic consumption, while Indonesia has a large digital market with the most dynamic economic growth in Southeast Asia but has uneven technology. Batam is supported by contributions from integrated industrial areas and its strategic location is chosen as a digital park location for both countries. Digital cooperation between Singapore and Indonesia through NDP investment in Batam aims to adopt technology in accelerating the movement of digital economy.

Does Sukuk financing boost economic growth? Empirical evidence from Southeast Asia

Purpose This paper aims to investigate empirically whether Sukuk financing is boosting the economic growth in Southeast Asia within the framework of the endogenous growth model. Design/methodology/approach This paper applied dynamic panel one-step system generalized method of moments as an optimal estimation approach to investigate the impact of Sukuk financing on economic growth in Southeast Asia spanning from 2013Q4–2019Q3. Sukuk financing was proxied by the total issued Sukuk holdings, while economic growth was proxied by gross domestic product. The sample covered all full-fledged Islamic financial institutions in the most developed Sukuk financial markets countries in Southeast Asia (Malaysia, Indonesia and Brunei). Findings The findings demonstrated that Sukuk financing is boosting economic growth in Southeast Asia, which reflects the significant role of the Islamic financial markets of Sukuk as a vital contributor to economic growth. Practical implications This paper would fill the literature by investigating the link between Sukuk financing and economic growth in Southeast Asia within the framework of the endogenous growth model, as the outcome of this paper serves as a guide for financial researchers, decision-makers and policymakers to improve the Sukuk market globally as an alternative financing source for the best contribution to economic growth. Originality/value This paper is the first that investigates empirically the link between Sukuk financing and economic growth in Southeast Asia with a new theoretical context of the endogenous growth model to gain robust information about this link.