ASEAN accelerates digital transformation

SGGP 06/06/2023 07:05

According to CNBC, the Association of Southeast Asian Nations (ASEAN) now has the makings of a digital economy: a young, tech-savvy population of more than 400 million digital consumers and growing internet penetration.

ASEAN has internet coverage of more than 70%. Photo: CNBC

Convenience and distance

According to the latest e-Conomy SEA 2022 report released by Google, Temasek and Bain & Company, the digital economy of six countries - Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam - is expected to grow by 6% per year.

However, there remains a digital divide between and within countries. “The reason behind this uneven development is the uneven distribution of digital economic benefits, as countries are at different stages of developing their regulatory frameworks, coupled with the urban-rural gap in digital literacy. So it requires detailed research, forward-looking policymaking and significant support from stakeholders in the region,” said Anthony Toh, research analyst at Nanyang Technological University, Singapore.

“Although ASEAN has over 70% internet penetration and most of its population owns smartphones, it is still dominated by social media. Therefore, adoption across the entire digital economy requires more digital literacy,” said Kenddrick Chan, a fellow at the Portulans Institute, an independent research institute based in Washington, DC.

Target 1,200 billion USD

ASEAN will increase the use of digital technology to expand trade and enhance economic cooperation among its 10 member countries. Auramon Supthaweethum, director general of the Department of International Trade Negotiations at the Thai Ministry of Commerce, said ASEAN will also continue trade negotiations with its six “dialogue partners” to establish new free trade agreements (FTAs) or expand existing ones. ASEAN is aiming to increase intra-bloc trade to $1.2 trillion by 2025. Auramon said senior economic officials from ASEAN and its dialogue partners - including the US, China, Japan, South Korea, India and Canada - met in Jakarta, Indonesia to discuss and will submit a report on the progress of FTA negotiations to the ASEAN Economic Ministers’ Meeting in August.

Meanwhile, Mr. Duangarthit Nidhi-u-tai, Deputy Director General of the Department of International Trade Negotiations, Ministry of Commerce of Thailand, emphasized that the focus of the negotiations last month in Jakarta was on the targets to be completed in 2023, including concluding the ASEAN-Australia-New Zealand FTA negotiations, implementing the Regional Comprehensive Economic Partnership Agreement, establishing a framework for the ASEAN Digital Economy Agreement so that leaders can announce the start of negotiations on this agreement this year. In addition, the parties discussed measures to accelerate internal processes so that member countries can sign completed economic agreements, such as the Protocol Amending the ASEAN Framework Agreement on Movement of Natural Persons and the ASEAN Food Security Legal Framework; and promote negotiations to strengthen the ASEAN Trade in Goods Agreement and report on progress in August. According to Mr. Duangarthit, FTA negotiations between ASEAN and China, India and South Korea have made significant progress, while discussions with Canada are continuing.

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