Category: Economy

The Philippines has taken a huge step forward in its energy transition by signing a $15 billion renewable energy agreement with Masdar in the UAE. The agreement, signed in Abu Dhabi, focusses on the development of solar, wind, and battery energy storage technologies, with the goal of generating up to 1 gigawatt of sustainable energy by 2030 and increasing to 10 GW by 2035.

Currently, renewable energy accounts for around 22% of the Philippine energy mix. The government plans to boost this to 35% by 2030 and 50% by 2040. Philippine Energy Secretary Raphael Lotilla emphasised that the agreement would help the country meet its renewable energy targets while also improving energy security and creating jobs.

The collaboration follows President Ferdinand Marcos Jr.’s visit to the UAE in November, during which agreements on investment, artificial intelligence, and energy transition were made. The project also marks Masdar’s entry into the Philippine renewable energy sector.

With coal accounting for more than half of the country’s electricity, the Philippines is looking at sustainable power options to deal with frequent outages and high energy bills. Lotilla went on: “Together, we are positioning the Philippines as a regional leader in sustainable energy.”

Singapore President Tharman Shanmugaratnam highlighted India’s growing role as a global economic powerhouse during his visit to Odisha. He emphasised Singapore’s commitment to supporting India’s semiconductor ecosystem, aviation connectivity, and skilling programs.

“India aims to be a geopolitical and economic powerhouse in a multipolar world. “We want to collaborate with India,” Shanmugaratnam said, citing the country’s demographics, development trajectory, and export possibilities.

The President highlighted India and Singapore’s shared priorities under the India-Singapore Ministerial Roundtable, which include the creation of a semiconductor ecosystem and industrial parks. He cited Sembcorp’s active pursuit of new industrial park locations in India.

Another key area is skill development, with Singapore harnessing its expertise to help India’s skill development ecosystem thrive. Sustainability was also highlighted as a significant collaboration area, with Singapore eager to participate in India’s solar, wind energy, and green ammonia sectors, as well as the establishment of a green corridor to Southeast Asia.

Shanmugaratnam emphasised the importance of connectivity and urged the expansion of the air service agreement, which was last amended a decade ago. Improved aviation linkages would strengthen both countries’ economic ties and enable tighter cooperation.

The President’s statements reiterated India and Singapore’s strong alliance, which aims to promote growth in important areas.

According to government sources, India intends to project nominal economic growth of 10.3%–10.5% for the upcoming fiscal year, which is higher than the current year’s forecast of 9.7%. As the country prepares for its slowest growth in four years in 2024–2025, the optimistic prognosis attempts to allay fears of an economic slowdown.

N.R. Bhanumurthy, director of the Madras School of Economics, stated that the growth forecast, which is fuelled by government capital expenditures, agriculture, and a resurgence in exports, is feasible. The administration of Prime Minister Narendra Modi has prioritised increasing growth through infrastructure spending, production-linked incentives for manufacturing, and corporate tax cuts.

To boost demand among salaried workers impacted by slow pay growth and high food inflation, Finance Minister Nirmala Sitharaman is anticipated to announce personal income tax cuts in the February 1 budget. Despite these measures, India is still committed to lowering its fiscal deficit. It projects this year’s budget shortfall to be 10–20 basis points smaller than the 4.9% early forecast, which was partially caused by spending delays brought on by the monsoon and elections.

India wants to reduce its fiscal deficit to less than 4.5% in the upcoming fiscal year.

Announcing intentions to make the UK a global leader in artificial intelligence, Prime Minister Sir Keir Starmer highlighted the technology’s potential to change public services and spur economic growth. The AI Opportunities Action Plan seeks to modernise infrastructure, create “AI Growth Zones,” and tackle issues like pothole detection, with the backing of top tech companies that have pledged £14 billion and created over 13,000 jobs.

The strategy shifts from the cautious AI approach of the previous administration to one that emphasises innovation and opportunity maximisation. Notably, the plan replaces previous plans for a supercomputer at Edinburgh University with an investment in a new supercomputer to improve computational capabilities. AI will also be used in public services to improve efficiency and lessen administrative hassles; its uses will range from helping teachers and small businesses to diagnosing cancer in the NHS.

Despite its ambition, the plan is criticised for its long-term viability and financial limitations. Alan Mak, the Shadow Science Secretary, attacked Labour’s economic policies and cautioned that they would impede development. Although they applauded the idea, experts like Professor Dame Wendy Hall emphasised the need for consistent commitment and patience to see benefits.

According to Ahmed Al Kaabi, Assistant Undersecretary at the Ministry of Energy and Infrastructure, the UAE is making quick progress towards its renewable energy ambitions, with a target of 14.2 GW of capacity by 2030. Speaking at IRENA’s high-level discussion on energy transitions, Al Kaabi emphasised the UAE’s role in the global clean energy transition through ambitious goals and investments.

As the first Gulf nation to join the Paris Agreement and pledge to net-zero emissions by 2050, the UAE is home to three of the world’s largest solar projects, with more underway. Masdar, founded nearly two decades ago, has been a driving force in worldwide sustainable energy advancements. The Distributed Solar System (DSS) project expands renewable energy by allowing rooftop solar power generation.

In addition to solar, the UAE has embraced peaceful nuclear energy with the Barakah Nuclear Plant, which generates 25% of its power and wants to be a leader in low-carbon hydrogen generation, with a target of 15 million metric tonnes per year by 2050.

The 15th IRENA Assembly in Abu Dhabi brought together 170 member states to address renewable energy expansion, innovative financing, and energy transitions in emerging economies.

As rising petrol prices put pressure on the economy, Egypt is expanding its solar power production thanks to its huge deserts, plenty of sunlight, and advanced electrical system. A government emergency plan was prompted by rolling blackouts last summer, which were caused by declining local gas production and rising usage.

Last year, Egypt spent more than $1 billion more than anticipated on LNG imports, and by 2025, prices are forecast to increase even further. Companies like AMEA Power emphasise the cost-effectiveness of solar energy as a less expensive option. With electricity costs of 2 to 3 cents per kilowatt hour, which is much less than gas turbines, AMEA just opened a $500 million, 500 MW solar plant in Aswan and wants to build another 1,000 MW facility by 2026.

Solar development has been hindered by tight rules and subsidies, notwithstanding the promise. Although formerly limited to 500 MW, new regulations now allow commercial power providers to provide electricity to companies. By 2030, the government wants to increase the share of renewable energy from 11.5% to 42%.

Although AMEA, Scatec, and UAE-based consortia are working on large-scale projects, analysts caution that a disjointed government strategy and inadequate infrastructure can hinder progress.

Brazilian President Luiz Inacio Lula da Silva signed a historic bill into law on Friday, enabling the construction of offshore wind farms to improve Brazil’s energy security and spur investment in renewable energy.

The legislation creates a comprehensive regulatory framework for offshore wind energy, with incentives to promote sector growth, create jobs, and increase the nation’s energy resiliency. It also specifies allowed energy generation areas, such as the country’s territorial sea, exclusive economic zone, and continental shelf.

Furthermore, the law requires informed consultation with affected individuals and communities before launching offshore projects, fostering openness and inclusivity. However, President Lula rejected Articles 22, 23, and 24 of the law, citing concerns about unrelated measures referred to as “jabutis.” The veto, backed by government ministries, seeks to protect customers from growing energy costs while lowering greenhouse gas emissions in the electrical sector.

Renewable energy already dominates Brazil’s energy landscape, accounting for 84% of its electrical grid through sources such as hydropower. Brazil has many of the world’s largest hydroelectric plants, including Itaipu, Belo Monte, and Tucuruí. Offshore wind farms diversify this mix by providing a zero-emission energy source generated by sea winds. According to IBAMA, 103 offshore wind farm projects are pending license.

Thailand had approximately 35.54 million foreign tourists in 2024, a 26.27% increase from the previous year, owing to relaxed entrance requirements and visa exemption policies, according to the Thai Ministry of Tourism and Sports. China was the leading source of tourists, with 6.73 million visits, followed by Malaysia (4.95 million) and India (2.12 million).

Tourism revenue was roughly 1.67 trillion baht ($48.45 billion) in 2024, a 34% increase over the previous year. Thailand launched an online electronic visa system in January to increase tourism, which is accessible globally through Thai embassies and consulates, streamlining the application procedure and allowing for quick online payments.

Currently, travellers from 93 countries and territories, including China, India, South Korea, and Russia, can remain in Thailand without a visa for up to 60 days. This program is expected to strengthen the country’s appeal to international visitors.

The Tourism Authority of Thailand expects to welcome up to 39 million tourists in 2025, generating 2.23 trillion baht ($64.71 billion).

Tourism remains a critical component of Thailand’s economy, accounting for 14.16% of GDP and 11.33% of employment in the second quarter of 2024.

Non-oil business activity in the UAE surged in December, with the Purchasing Managers’ Index (PMI) rising to 55.4 from 54.2 in November, according to an economy tracker. This nine-month high reflects strong demand and continued growth in the non-oil private sector.

S&P Global attributed the robust expansion to favorable market conditions, highlighting the UAE’s progress under Vision 2031. This strategy focuses on diversifying the economy by promoting industries like manufacturing, tourism, and technology to ensure sustainable growth.

David Owen, a senior economist at S&P Global Market Intelligence, noted, “The UAE saw its best expansion in non-oil business conditions for nine months in December. The latest PMI data closed out another year of continuous growth, positioning the sector well for 2025.”

A PMI reading above 50 signals growth, while below 50 indicates contraction. Business owners reported securing new clients and larger order books due to buoyant market conditions. However, staffing levels grew at the slowest rate in over two-and-a-half years.

“Capacity levels remain under stress, shown by a marked increase in backlogs of work,” said Owen. “Recruitment appears to be the limiting factor, with employment growth barely changing from November’s 31-month low

Singapore is making a bold move in its energy transition with the construction of a groundbreaking hydrogen power plant. PacificLight Power is leading this initiative, investing US$1 billion in a 600-megawatt facility on Jurong Island.

This state-of-the-art plant will start by using a mix of hydrogen and natural gas, with the potential to switch entirely to hydrogen in the future. It is set to become Singapore’s largest and most efficient combined cycle gas turbine power plant.

The plant’s focus on clean energy aims to cut carbon emissions significantly, supporting Singapore’s goal of achieving net-zero carbon emissions. A large-scale battery energy storage system will also be integrated, improving grid stability and optimizing energy delivery.

The project is currently undergoing an environmental impact assessment, a critical step before final site selection. Jurong Island, with its ample space, is a strong candidate, but other options are still being considered.

This project is a major part of Singapore’s strategy to reduce its reliance on natural gas for electricity. The nation plans to have nine hydrogen-compatible power plants by 2030. Hydrogen, with zero carbon emissions when burned, offers a cleaner and more sustainable alternative to traditional fossil fuels.