AGP Executive Report

ASEAN & Malaysia Diplomacy: Malaysia’s PM Anwar Ibrahim pledged closer work with the Boao Forum for Asia and reaffirmed support for ASEAN’s resilience, inclusiveness and AI/energy transition priorities amid Myanmar, South China Sea and West Asia spillovers. Energy Transition Finance: The ADB launched a $20m energy-efficiency loan facility for Cambodia SMEs via an Energy Efficiency Revolving Fund, aiming to cut costs and boost competitiveness. Cloud & Startup Push: Alibaba Cloud pledged $1bn for “Project AsiaForward” to train 100,000 developers and back startups across Asia, while also cutting cloud prices by 15%-50% to win users ahead of a possible Aliyun spin-off. AI Infrastructure & Markets: IQM Quantum Computers became the first European quantum firm listed on a major US exchange (Nasdaq: IQMX), while Asian markets stayed choppy on chip and AI-related jitters. India-Japan Energy Security: Modi and Japan’s Takaichi agreed on concrete energy-security cooperation, including stockpiling and emergency response mechanisms. Business Expansion: Suzano and Kimberly-Clark’s consumer joint venture deal created Arbex with 51% Suzano ownership, scaling brands and manufacturing across 14 countries. Digital Payments/Fintech: Bitget Wallet launched a Mastercard-linked crypto card in South Asia, enabling USDT/USDC top-ups and global spending.

Philippines-Canada Diplomacy: President Ferdinand Marcos Jr. heads to Vancouver for talks with PM Mark Carney, aiming to firm up a Plan of Action on trade, investment and energy cooperation. Banking & Regulation: Sri Lanka’s Cabinet approved an ADB-backed digital overhaul of CBSL banking supervision to replace heavy physical record-keeping with a technology-based supervisory platform. ASEAN Manufacturing: S&P Global says ASEAN’s manufacturing PMI slipped to a near-standstill 50.5 in June, with weaker new export orders and softer employment. M&A & Tech Finance: Singapore remains the deal magnet in Southeast Asia tech M&A, led by KKR and Singtel’s $6b-plus ST Telemedia Global Data Centres buy. Corporate Moves: RCBC is taking pre-emptive steps—shortening investment duration and tightening credit risk—to brace for a tougher macro backdrop. Energy & Food Risks: El Niño could intensify into a “Godzilla” scenario, raising the odds of food price shocks across monsoon-dependent ASEAN economies. Climate & Health: Singapore warns haze could be severe in August-September due to El Niño-driven dry spells. AI & Quantum: Korea gets its first locally operated Quantum-as-a-Service platform via QAI and Classiq’s partnership. Market Pulse: Asian shares slid as chipmakers dragged; Japan’s yen weakness is also adding strain, with more bankruptcies tied to currency pressure.

Middle-Power Diplomacy: Australia’s High Commissioner to Malaysia Danielle Heinecke urged closer middle-power coordination to avoid “binary choices,” calling for joint action across trade, tech, defence and maritime while backing regional rules. Wealth & Markets: HSBC Private Bank set Malaysia’s FBM KLCI year-end targets (1,830–1,850), pointing to earnings growth and energy/AI supply-chain themes, while keeping 2026 GDP growth at 4.5%. Energy Security Watch: Shell’s LNG Outlook 2026 warns that Hormuz-linked disruptions could stall LNG trade growth and tighten spot supplies, reinforcing the need for reliable infrastructure and steadier policy. China Policy Shift: China’s new “national security” outbound investment rules take effect, raising concerns about limits on tech ecosystem access to global markets. Southeast Asia Digital Push: Ant International opened an AI/fintech Global Development Centre in Kuala Lumpur and KPS launched an Asia platform, signaling continued regional expansion. Indonesia Tax Crackdown: Indonesia orders major e-commerce platforms to collect income tax from sellers from August, targeting a fast-growing online economy. EV Momentum (India): India’s passenger EV registrations jumped ~90% in Q1 FY27, driven by improving ownership economics. Aviation Connectivity (Kazakhstan–China): FlyArystan launched the Almaty–Xi’an route, adding to the “Air Silk Road” links. Climate Tech (China–Central Asia): China and Central Asian partners are developing a disaster-predicting satellite constellation using AI processing in Xinjiang.

Banking Deal: Kotak Mahindra Bank has signed an agreement to buy Deutsche Bank’s India retail, private banking and wealth business, adding about ₹29,000 crore in loans and ₹16,000 crore in deposits, with closing targeted for September 2027 pending regulators. Energy & Prices: Nayara Energy cut petrol by Rs 5 and diesel by Rs 3 at its stations as global crude eased after West Asia tensions cooled, while state-run retailers kept prices unchanged. Trade Resilience: Singapore is pushing a new model of rules-based cooperation via essential-supplies trade pacts, including an agreement with New Zealand to keep ports and air terminals open during disruptions. Asia Markets: July 1 opened mixed across Southeast Asia, with Indonesia’s Jakarta Composite down 5.48% while Thailand’s SET rose 2.1%. AI & Industry: Private surveys suggest Asia’s factories got a June boost from the AI supply chain, helping offset some Iran-war drag, though shipping delays and supply shortages remain a risk. Mongolia-EU: Mongolia and the EU held their 24th joint committee meeting in Brussels, focusing on infrastructure, renewables, trade and agriculture.

Banking & Deals: Maybank Indonesia got shareholder approval to set up as the operational holding company for the Maybank Financial Conglomerate, alongside majority-stake acquisitions in Maybank Asset Management, Maybank Sekuritas Indonesia and Etiqa—aimed at a more integrated ASEAN financial-services ecosystem. Aviation: IATA said May 2026 air passenger demand fell 2.2% y/y, dragged by West Asia conflict, though load factors hit record highs for May. Energy & Trade Routes: Shell warned global LNG trade could stay flat in 2026 as Hormuz disruptions cut about a fifth of monthly supply, with some offset from North America ramp-ups and slower Asian imports. Macro & Weather Risk: India’s monsoon outlook worsened—July rainfall forecast below 94% of average after a fifth-driest June—raising stakes for farm output and growth. Policy & Business Climate: Bangladesh’s DCCI criticized Bangladesh Bank’s steady 10% policy rate as a fiscal-monetary mismatch, urging faster, simpler refinancing access for MSMEs. Corporate Moves: Kotak Mahindra agreed to buy Deutsche Bank’s India retail, private banking and wealth management business. Cybersecurity: The Internet Society will host the 2027 NDSS Symposium in Seoul, signaling Asia-Pacific’s growing research pull. Housing & Construction: A Northern California modular-housing partnership backed by Health Net targets hundreds of affordable zero net energy units by 2028.

Malaysia–South Korea Trade: MATRADE says Malaysia secured RM160m export prospects at Korea Import Expo 2026, beating its RM120m target, with 17 firms pitching to top buyers in Seoul. Fintech Expansion: Paydibs plans to enter Thailand, Indonesia and the Philippines by year-end, then expand across Cambodia, Vietnam and South Asia, starting with cross-border payments for e-commerce merchants. Climate Tech Funding: Cambodia’s AI smart-grid project was selected for international backing under the Climate Technology Accelerator Fund, aiming to cut energy losses and modernize aging networks. Telecom AI Marketing: MoEngage and Boldest (Prodapt) partner to bring cognitive marketing to telecom operators, targeting churn reduction and faster personalized campaigns. Central Asia Connectivity: Georgia and Kazakhstan signed a strategic partnership as leaders focus on trade, transport, logistics, tourism and the Middle Corridor. Markets & Energy: Asian stocks wobbled as the dollar strengthened and oil eased; in India, Sensex and Nifty opened lower while crude tracked US-Iran peace signals. Fuel Relief in the Pacific: Fiji cut diesel, petrol and LPG prices for July, citing easing global fuel costs after Middle East ceasefire progress. AI Risk Watch: The BIS warned AI-related financing may be over-leveraged, with compressed risk premiums raising bust risks. Regional Trade Rules: CPTPP ministers advanced expansion talks and set next steps on accession and implementation, including work on UAE, Philippines and Indonesia.

Malaysia Economy & Industry: Malaysia’s MITI says subsidy rationalisation can protect MSME margins and keep the country competitive if rolled out gradually, targeted, and paired with support—pushing automation for MSMEs, EV and green-energy infrastructure, and skills for a shift to higher-value industries. Aviation & Trade: IATA reports global air cargo demand rose 6% in May, with Asia-Pacific up 8% year-on-year, while Middle East carriers saw a 8.9% contraction as war-related impacts linger. Energy & Consumer Impact: India will lift temporary petrol and diesel sale curbs from July 1 after fuel supplies stabilised following West Asia disruption fears. Banking: Asia United Bank (AUB) approved a capital stock increase to P72.5B and set cash and stock dividend proposals, pending shareholder and regulatory approvals. Aviation Business: Malaysia Airports is accelerating post-privatisation transformation to improve governance, project delivery and passenger experience across its network. Cross-border Compliance: FedEx says many APAC exporters are still unprepared for new US CPSC product safety e-filing rules starting July 8, warning of potential shipment delays. Digital Trust for SMEs: Kaspersky and Digital Penang partner to boost cybersecurity readiness for Penang’s MSMEs under the state’s digital economy plan.

Philippines-Canada Deal Talks: President Ferdinand Marcos Jr will visit Canada July 1-4 to meet PM Mark Carney on defense and economic resilience, energy and critical minerals, and people-to-people ties, with talks also aimed at speeding a Philippines-Canada free trade agreement. Markets & Oil: Asian stocks traded cautiously as Middle East ceasefire uncertainty and Fed rate worries kept investors on edge; crude rose on renewed Strait of Hormuz control claims by Iran, while gold slipped and silver bounced on the same risk backdrop. Aviation M&A: Korean Air won final domestic approval to merge with Asiana, clearing the last hurdle for a Dec 17 integration. Tech & AI Infrastructure: Tencent Cloud helped Indonesian telecom XLSMART complete a large public cloud migration using AI-assisted skills; Comin Asia and Nokia plan sovereign, AI-ready data centre infrastructure across Southeast Asia. Trade & IP: Hong Kong and Guangdong held an IP Go-Global matching session to help mainland firms use Hong Kong as an international launchpad. Business Leadership & SMEs: Malaysia’s Samenta re-elected William Ng and pushed a tech-driven SME scaling blueprint focused on AI, policy reform, ESG and moving from OEMs to IP ownership. Climate Risk: Southeast Asia faces deadly humid heatwaves as wet-bulb conditions push human cooling limits. Philippines Macro: The Philippines cut growth targets and expects a weaker peso beyond 2028, citing Middle East tensions and El Niño.

U.S.-Iran ripple effects on Asia’s trade and markets: Even as negotiations continue, fresh US-Iran strikes risk renewed disruption around the Strait of Hormuz, keeping crude and sentiment volatile across Asia. Philippines FX pressure: ANZ says oil-price relief hasn’t helped the peso, with external imbalances and a stronger dollar driving weakness despite BSP intervention. Cost squeeze for food vendors: Across Asia, plastics prices are jumping as energy-linked supply tightens, hitting everything from bags to trays for street and market sellers. Banking rates ease in Nepal: Nepal’s average commercial bank base rate slipped below 5% as deposit growth outpaced credit demand, signaling potential lending-rate pressure relief. South China Sea diplomacy heats up: The Philippines accuses China of “insincerity and hypocrisy” after Beijing rejects Manila’s push to honor the 2016 arbitral ruling. Policy and governance tech in India: India launched an AI-enabled Rural Internal Audit Portal to replace paper-heavy internal audits and improve oversight of rural spending. Trade ties in focus: UAE and Panama discussed boosting trade, investment and supply-chain resilience under “UAE Trade Days,” while Pakistan is set to lead the SCO Business Council in 2027. Logistics award: Ethiopian Cargo won AFLAS “Best Air Cargo Carrier – Africa,” underscoring its push to connect trade routes across regions. Corporate/market watch (India): Analysts flag FY27 IT demand risk as GenAI-driven spending shifts and geopolitics cloud deal conversions and guidance.

Climate Risk for Renewables: Zurich Group warns India’s 267 GW renewable pipeline is exposed to physical climate hazards, with 90% of planned sites facing high or critical risk by 2030—solar dominates the assessed capacity. Energy & Costs: Australia’s fuel prices have slid back to pre-Iran-war levels, but a planned partial fuel excise return could lift prices soon. Finance & Regulation: Malaysia’s ringgit strengthened as investors trimmed US rate-hike expectations; Pakistan’s PVARA urged emerging markets to shape digital-asset rules as money turns “into software.” Trade & Supply Chains: Verisk Maplecroft flags “rising star” economies—Thailand, the Philippines and Argentina—where resilience and openness could attract new supply-chain roles. ASEAN Tech Push: Thailand proposes an ASEAN CHIPS Act to build a unified semiconductor ecosystem, including a regional council and shared standards. South Asia Water Politics: India’s Indus Waters Treaty suspension keeps the spotlight on how water governance and basin ecology are colliding. Business Moves: A-Sonic Aerospace eyes Asean acquisitions to expand its regional footprint; SBM Offshore lines up Asian shipyards for TotalEnergies’ Venus FPSO as July FID nears. Workplace & Society: A Gallup report finds Filipinos are the most stressed in Southeast Asia, even as engagement remains highest in the region.

APEC Tourism: Tourism ministers from 21 APEC economies met in Macao for the 13th APEC Tourism Ministerial Meeting, focusing on digital innovation and visa-facilitation to deepen Asia-Pacific tourism cooperation. Electronics Push (India): Uttar Pradesh CM Yogi Adityanath and Union minister Ashwini Vaishnaw launched Rs 6,750 crore electronics projects in Jewar to make advanced multi-layer PCBs and cut imports. AI Race (Asia): Tokyo’s Sakana AI and Beijing’s 360 Security rolled out new AI tools as alternatives to Anthropic’s Mythos/Fable amid a US export ban. Trade & Policy (India–US): India is reportedly seeking a sunset clause in an interim trade deal with the US, reflecting uncertainty over Washington’s policy durability. Energy Security (Cambodia): PM Hun Manet warned Cambodia’s economy faces rising global uncertainty and higher standards as it prepares to graduate from LDC status in 2029. Logistics Expansion (CEECA): Rohlig SUUS Logistics signed an investment deal to expand across Central and Eastern Europe and Central Asia, backing growth with new development projects.

Philippines-Canada Trade Push: President Ferdinand Marcos Jr. will visit Canada July 1-4, aiming to accelerate talks on a Philippines-Canada FTA and a Canada-ASEAN FTA, with trade, investment, defense, energy and critical minerals on the agenda. APEC Tourism in Macao: The 13th APEC Tourism Ministerial Meeting opened in Macao under “Digital Innovation,” spotlighting tourism cooperation across the Asia-Pacific. ASEAN Science Agenda: ASEAN opened its 22nd Science, Technology and Innovation ministerial meeting in Laos, focusing on implementing the 2026-2035 APASTI plan to boost resilience and competitiveness. Southeast Asia FX Caution: Analysts expect regional central banks to stay wary as the US dollar strengthens and inflation risks linger, even as oil prices ease. India Growth Upgrade: Goldman Sachs lifted India’s 2026 growth forecast to 6.8% after the US-Iran peace deal, citing lower oil-price risks. Energy Prices Watch: India’s OMCs are unlikely to cut retail fuel prices soon despite crude declines, as they prioritize recovery of under-recoveries. China-Eurasia Trade Signals: The 9th China-Eurasia Expo in Urumqi is highlighting green and smart tech for cross-border trade. India-UK Business Talks: Piyush Goyal met UK India Business Council leaders to push investment and sector collaboration. OpenAI India Leadership: Uber India’s Prabhjeet Singh is set to join OpenAI as Managing Director for India operations. Macao Tourism Award: Tourism Malaysia won an ASEAN Master Class Award 2026 for destination promotion.

Malaysia Finance & Consumer Protection: Bank Negara Malaysia launched the “Semak Kasih” portal so families can check whether relatives have unclaimed insurance or takaful coverage, aiming to boost financial literacy and ensure protection for medical and disaster costs. Malaysia Advanced Aviation Tech: MIGHT demonstrated a Low Altitude Economy mini sandbox for drones, unmanned traffic management and air mobility, targeting RM50.7bn GDP impact and 100,000 high-value jobs by 2030. Philippines-Canada Trade Push: PM Mark Carney will host President Ferdinand Marcos Jr. in Vancouver, with talks aimed at accelerating Canada-Philippines and Canada-ASEAN free trade negotiations plus cooperation on maritime security, energy, critical minerals and tourism. Armenia MSME & Sustainable Finance: Converse Bank and ADB signed up to $15m to expand MSME lending, including at least 20% for women-led businesses, with a focus on renewable energy and efficiency. Southeast Asia Business Expansion: Smartworks agreed to acquire Singapore’s Workstudio Spaces to expand its managed workspace footprint in the city-state. APEC Tourism Cooperation (Macao): Macao hosted APEC’s tourism working group meeting, spotlighting digital transformation, travel facilitation and sustainable tourism ahead of the tourism ministerial. India Payments Integration: India and Nepal operationalised person-to-person cross-border digital payments via mobile numbers/UPI IDs, extending India’s financial connectivity push in the region. Markets & Risk Mood: Asian equities slid amid tech sell-offs and geopolitical jitters, while bitcoin struggled to reclaim $60,000. Climate & Disaster Costs: The UN weather agency warned extreme weather has killed over 2m people and caused $4.3tn in damages over 50 years, with economic losses still rising.

ASEAN Power Grid Push: Sarawak Energy is stepping up Borneo electricity interconnections, eyeing links with Sabah, Brunei and even a Sarawak–Singapore subsea cable as the long-running ASEAN Power Grid plan gains momentum. Cyber Insurance Gap: Tokio Marine Kiln warns Asia-Pacific manufacturers face rising uninsured losses as cyber attacks increasingly hit industrial systems, with many policies leaving physical damage and production disruption uncovered. India–UK Trade Boost: India’s CETA and a Double Contribution Convention are set to take effect from July 15, 2026, aiming to expand market access and cut double social security costs for cross-border workers. West Asia Shock Eases for India: India restored commercial LPG supplies to pre-crisis levels as restrictions were lifted and supply chains stabilised, while Tata Motors flags short-term diesel and commodity headwinds but expects long-term growth to support CV demand. Asia Markets & Chips: Asian shares cooled from highs as Apple raised iPad and MacBook prices amid memory and storage cost pressure, even as Micron’s strong results kept AI-chip optimism alive. Singapore Longevity Banking: DBS, OCBC and UOB with NETS pledge cash access within 500 metres of every HDB block by end-2027 to support a super-aged society. Philippines Circular Economy Pilot: The Philippines joins an ASEAN pilot to help MSMEs test a Circular Business Check and turn sustainability goals into measurable action. Renewables Climate Risk: A report says 90% of India’s renewable portfolio faces high or critical climate risks by 2030, urging resilience investment.

South China Sea Security Web: The Philippines and Vietnam upgraded defense ties, adding deeper information-sharing and joint sea activities, while India’s BrahMos deal with Vietnam underlines how Southeast Asia is building practical, non-alliance security links. Climate & Risk: Singapore and the region face a red-alert haze outlook for H2 as El Niño returns and deforestation pressures rise, with fire readiness strained by uncertainty. Supply Chains & Industry Strategy: China’s GEAR push at the CISCE expo spotlights green infrastructure, AI and resilience as it courts global partners. Philippines Growth Hit: S&P cut the Philippines’ 2026 growth forecast to 4.1% as infrastructure spending stalls and energy shocks bite. Semiconductors Push (Malaysia): Malaysia will focus on high-value IC design and offer token access to local firms to speed chip capability building. Trade Deal Standoff (India-US): India says it won’t activate a US trade pact unless it secures a tariff edge over ASEAN and neighbours. Digital Finance (Ghana): Trident launched Sikaflow to formalize Ghanaian MSMEs with verifiable records and easier tax compliance. Energy Truce Effects (India Inc): A US-Iran Hormuz reopening is easing crude costs, helping narrow margin damage fears for Indian firms. ASEAN-China Media Fight Disinfo: Asean-China forum calls for shared frameworks to counter cross-border misinformation. Green Economy (India): LSEG says India’s green revenues hit $110bn in 2025, with rapid clean-tech growth. Markets Watch: Oil weakness and tech swings kept Asia cautious as investors weigh rates and geopolitics.

Markets & FX: The Indian rupee looks set to strengthen at the open as oil slides back below pre-Iran-war levels, while a surging dollar keeps pressure on other Asian currencies. Energy & geopolitics: Brent crude fell to the lowest since before the Iran war as more tankers exit the Strait of Hormuz, easing inflation worries and helping risk sentiment. Equities: India’s Sensex and Nifty opened higher on the crude cooling and upbeat chip earnings (Micron/Qualcomm), while Asia broadly rallied. Business expansion: Federato opened its first Asia-Pacific base in Sydney to push AI into insurance underwriting and claims; AMC Robotics signed a Vietnam lease to scale robotics manufacturing. Hydrogen & industry: H2SITE secured additional funding to accelerate industrial hydrogen deployment. Regional trade & infrastructure: Malaysia-Singapore power interconnection Phase 2 is operating at full 200MW capacity, with feasibility work for a bigger 1,000MW link underway. Policy & development: S&P expects India’s FY27 growth to slow to 6.6% on energy stress and a weak monsoon. ASEAN governance: Philippines faces a harsh civil-rights score, with “safety from the state” flagged as a major concern.