SE Asia

When the ALT partnership was announced back in early January we got a small glimpse of why ALT was interested in marketing an integrated coms/security product in Thailand, but there wasn't much detail to explain what this was all about. A professional investor might have known that Thailand was a hub for auto production and had a big medical tourism trade in low cost surgery but that was about it.

We have had an excuse for not caring. SE Asia has been secondary or irrelevant to the ASX for a long time. We have now been a dig and ship economy for 30-40 years and China has been the "factory of the word" for nearly as long. During that time Thailand has been a kind of minor China by proxy, but not supplying the IP. A dozen or more large contract manufacturers have set up there as wages are relatively low and the young population fairly docile and well educated. This also suits scores of "Mittlestrand" German and Swiss firms with their production of specialised medical equipment and consumer electronics.

But things have changed. China is imploding as Evergrande and now Country Garden and a dozen smaller developers collapse . The ghost cities have turned out to be what they looked like: the empty shells of China's Ponzi economics. US companies are re-shoring as fast as they can. But not surprisingly many Chinese companies are also hedging their bets either to get money out of China or so they can stick a Made in Thailand label on products exported to the US.

This is all happening at fairly high speed and is a bit of blur, but for clear glimpse of how this is shaping up a recent presentation by Pan Asia Metals sets the scene. PAM has two lithium mining projects in Thailand and is planning to send processed battery-ready LI powder to battery plants in the region.

Page 3 of the presentation is usefully revealing. In Thailand there will be 14 EV plants and 18 battery plants. In Malaysia two battery plants and several EV plants, Vietnam at least two and possibly three to four EV plants. Gotion, a Chinese company is planning to joint venture with VinFast, the Vietnamese EV company. Samsung is setting up in Vietnam as well.

This all ties in with how how ALT is trying to position itself as a leading IT and Telco supply company benefiting from Thailand's ''digital transformation". All these plants will use state of the art automation with supply chains also requiring networking and, almost by definition, they will all be targets for cyber infiltration, attacks and blackmail.

And sure enough in the latest newsletter from cyber group Recorded Future News there is a report that Microsoft has just discovered 16 new vulnerabilities in its CODESYS software. This white sandwich software manages logic controllers (ie in factory systems and critical infrastructure) so right in the heart of the Thailand data driven 4.0 transformation there is a critical weakness.

These plants may be planning to make a battery cell every 30 seconds or ten injection needles a second but the more automated they are the more likely they are to come under attack.