Abstract
For several decades, Northeast Asia has invested heavily in ASEAN’s fossil fuel industries. This investment has been fundamental in ASEAN’s industrial and regional development and has also been a main source of foreign exchange. In recent years, however, while energy demand in Japan and Korea has been slowing down, it has begun to increase rapidly in ASEAN at a time when some of its own oil and gas fields are beginning to decline. The sharp rise in ASEAN’s demand for energy is partly the result of massive FDI from Northeast Asia in manufacturing enterprises. This investment is enabling ASEAN to become less dependent on the export of fossil fuels for foreign exchange. Indonesia has already announced it is reducing its energy exports to Japan because it wants to use the fuel domestically. Without doubt, the other ASEAN energy exporting countries will also soon be reconsidering their energy export contracts with Northeast Asia.
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