Latest Economic Highlights in Southeast Asia (January 19, 2026)

1. Indonesia Establishes US$6 Billion State-Owned Enterprise to Shield Textile Sector from US Tariffs

Indonesia's government is launching a state-owned enterprise managed by sovereign wealth fund Danantara with up to US$6 billion in initial funding to protect the textile and garment sector from 19% US tariffs and low-cost Chinese imports. The industry employs over 6 million workers, and the move aims to enhance local supply chain upgrading and competitiveness.

2. Vietnamese Footwear Makers Feel the Heat of US Tariffs

Vietnamese footwear manufacturers are directly impacted by new US tariffs, raising export costs. Calls for government subsidies and market diversification grow to maintain position in global supply chains, highlighting challenges for export-oriented Southeast Asian economies amid trade tensions.

3. Southeast Asia 2026 Economic Outlook: Vietnam Leads, Indonesia FDI Rebound Expected

Vietnam is projected to lead Southeast Asia's growth in 2026, driven by robust manufacturing and supply chain shifts. Indonesia's FDI is expected to rebound, with strong inflows into data centers and AI in Malaysia and Thailand. The region benefits from recovering domestic demand and infrastructure investments despite global uncertainties.

4. Philippines Plans to Put National Budget on Blockchain

Philippine officials aim to become the first country to place its national budget on blockchain for greater fiscal transparency and efficiency. The initiative supports ambitions to attract data centers, AI services, and foreign investment, positioning the country as a regional digital infrastructure hub.

5.Southeast Asia Digital Economy Surpasses US$300 Billion in 2025, Driven by AI Wave

Southeast Asia's digital economy exceeded US$300 billion in 2025, fueled by AI transformation. Singapore anchors the region, with investors focusing on quality growth and efficient capital allocation. This trend is expected to continue into 2026, bolstering regional economic resilience.