Table of Contents
Southeast Asia has emerged as a key player in the global trade sweet spot, benefiting from the push for supply-chain diversification in the wake of the COVID-19 pandemic. However, recent tensions in the Red Sea have highlighted the vulnerability of international supply chains, leading to increased shipping costs and longer delivery times. To address these challenges, there is a growing need to build more diverse regional networks and embrace digitalization. Southeast Asia's large consumer base and digitally enabled population make it an attractive investment destination and production base. Additionally, there is a push to rationalize supply networks and source key components from neighboring countries. The region's expanding network of instant payment platforms and the increasing digitalization of transactions within supply chains are also helping businesses improve access to trade finance and optimize cash management. However, a more united effort involving various stakeholders is needed to fully realize the potential of digitalization. The success of these efforts will significantly impact Southeast Asia's importance in global trade networks and economic growth trajectory.
