Australia has announced that it will establish a A$2 billion (€1.24 billion) finance facility to boost trade and investment in Southeast Asia as it looks to deepen ties in a region as other players are grappling with a more assertive China.
The new fund will focus on the clean energy and infrastructure segments, and is set to provide loans, guarantees, equity investments and insurance. Australia will also commit an extra A$140 million to extend an existing program which advises the region on infrastructure projects.
Prime Minister Anthony Albanese announced the inception of the fund in a speech to a gathering of business leaders at the Association of Southeast Asian Nations (ASEAN) summit in Melbourne. The fund was recommended last year by Australia’s envoy to the region.
“Australia and Southeast Asia must together face this moment with a sense of optimism and urgency,” Albanese said. “Because while there is so much untapped potential, there is not unlimited time. We must act together, and we must act now.”
Two-way trade between Australia and ASEAN states passed $178 billion in 2022, greater than Japan or the United States, Albanese said.
Australia is hosting the ASEAN summit, which marks the 50th anniversary of its ties to the bloc, amid growing recognition in Canberra that the region needs to be cultivated at a time when China’s increasing assertiveness is reshaping the Indo-Pacific.