Strengthen Energy, Economic Strategy Amid Global Uncertainty, ASEAN Told

BANGI, April 20 (Bernama) -- ASEAN must urgently strengthen regional coordination and craft a cohesive strategy on energy security and economic resilience in response to escalating geopolitical tensions and supply chain disruptions, said Universiti Kebangsaan Malaysia Vice-Chancellor Prof Datuk Dr Sufian Jusoh.

He said the bloc with approximately 700 million people should consider convening an emergency Special Leaders’ Meeting involving heads of government and economic ministers to formulate a unified response aligned with the ASEAN Vision 2045, which emphasises building a resilient and agile regional bloc.

“ASEAN must act as a regional group, particularly in addressing challenges related to energy security, supply chain disruptions and the overall economic health of the region,” he told the media at the ASEAN+3 Regional Economic Outlook and ASEAN+3 Fiscal Policy Report Outreach Seminar here today.

During the 90-minute seminar that was jointly hosted by Institut Kajian Malaysia dan Antarabangsa (IKMAS) and ASEAN+3 Macroeconomic Research Office (AMRO), Sufian said that while some member states are facing immediate pressures on fuel reserves, the bloc must also adopt a long-term strategy to transition away from fossil fuels by expanding the use of renewable energy sources such as hydrogen, solar and wind.

Beyond energy, Sufian emphasised the need for structural reforms to strengthen regional economic integration, particularly in reducing overdependence on external supply chains involving major economies such as China and the United States.

“ASEAN should enhance intra-regional trade, investment and production capacity, while also addressing vulnerabilities in food security by encouraging localised agricultural production across member states,” he said.

It was reported that the upcoming 48th ASEAN Summit, scheduled for May 8-9 in the Philippines, will focus specifically on the economic shocks, oil supplies and food security caused by the US-Iran conflict.

In the recent special meeting held on April 13, the ASEAN Foreign Ministers addressed the severe energy and economic impacts of the ongoing conflict, urging a permanent ceasefire and the restoration of safe passage in the Strait of Hormuz.

The conflict has resulted in an energy crisis for the region, prompting calls for unified action to manage oil, food and supply chain disruptions.

Meanwhile, shifting focus to Malaysia, Sufian described the government’s move to implement the B15 biodiesel programme as a positive step, but cautioned that reliance on fossil fuels remains significant and requires further policy strengthening.

He also highlighted the importance of improving public transportation infrastructure and connectivity, particularly addressing last-mile challenges, to reduce overall energy consumption and dependence on fuel subsidies.

“The biggest issue is not just increasing ridership, but ensuring connectivity to MRT and LRT stations. Without that, efforts to shift towards public transport will be limited,” he said.

Meanwhile on the fiscal sustainability, Sufian raised concerns over the growing burden of fuel subsidies for the government, noting that current levels could reach up to RM36 billion annually if left unchecked.

He also suggested that the government consider transitioning towards a more targeted subsidy mechanism, where assistance is channelled to lower-income groups, while higher-income earners pay market prices.

“The government should be looking at reallocating certain subsidies, particularly towards diesel, given its direct impact on small businesses and the cost of essential goods such as food,” he said.

-- BERNAMA