Over the past three decades, the five most steel-intensive Southeast Asian countries, Indonesia, Thailand, Viet Nam, Malaysia and the Philippines, have emerged as important players in the global steel sector, contributing three percent of global steel production. Rapid industrialisation and infrastructure development have significantly increased regional steel demand, while production in Southeast Asian countries has quadrupled over this period.
However, the region has seen a surge in emission-intensive steel manufacturing investments, with steel sector emissions having almost doubled within the last five years. This highlights the urgent need to curb emissions, especially in the carbon-intensive steel sector.
As global trade dynamics evolve and low-cost steel imports grow, the Southeast Asian steel sector finds itself at a crossroads, either it continues to rely on fossil fuels, or it seizes the chance to lead with green technologies of the future. Policymakers now have a unique window of opportunity to shape this transition by aligning industrial growth with climate goals.
This paper provides a comprehensive analysis of the steel sector and sets out a clear roadmap for how Southeast Asia’s steel industry can achieve technically and economically viable net-zero emissions by the 2050s, supporting both regional and global decarbonisation goals while sustaining economic growth.