As ASEAN chair, Indonesia has consistently set ambitious goals for itself. ASEAN established the ASEAN Community in 2003, followed by the Regional Comprehensive Economic Partnership (RCEP) in 2011. It’s no wonder that Indonesia has lofty goals as this 12 months’s ASEAN chair. By launching the ASEAN Digital Economy Framework Agreement, Indonesia hopes to bring ASEAN closer to 1 regional digital community (ASEAN DEFA).
ASEAN has made significant progress in constructing this digital community. ASEAN Digital Ministers recently adopted the Boracay Digital Declaration “Synergy towards a Sustainable Digital Future” on February 9-10, 2023. Guided by the ASEAN Digital Master Plan 2025 and the Bandar Seri Begawan Action Plan, the Declaration recognizes the importance of society digitally inclusive by closing the digital divide; a trusted, secure and secure digital marketplace by implementing needed digital data governance similar to data governance, cybersecurity and artificial intelligence management; and people-centric digital government.
Under Indonesia’s leadership, ASEAN will complete the ASEAN DEFA feasibility study and start negotiations for an agreement in 2025. DEFA is modeled on so-called “digital-only” agreements (Digital Economy Agreements or DEA). Unlike the digital provisions of traditional trade agreements, which usually deal with market access, DEAs aim to facilitate cross-border cooperation on wide-ranging issues similar to cross-border data flows, personal data protection, artificial intelligence management and digital identification systems. Singapore is currently the one ASEAN member state (AMS) to have signed DEAs: it has DEPAs with Chile and New Zealand, the Singapore-Australia DEA, the UK-Singapore DEA, and the Korea-Singapore Digital Partnership Agreement.
The vast disparity in AMS readiness for true digital integration across the region is a significant obstacle to achieving an ASEAN-wide digital future and a high DEFA standard. The ASEAN Digital Inclusion Index assesses six dimensions of digital inclusion readiness on the country level: digital trade and logistics, data protection and cybersecurity, payments and digital identity, digital skills and talent, innovation and entrepreneurship, and institutions and infrastructure. Malaysia and Singapore scored higher than the regional average in all six dimensions in 2021, while Cambodia, Lao PDR and Myanmar didn’t. Meanwhile, the outcomes of Indonesia, Thailand, Vietnam, the Philippines and Brunei Darussalam were mixed.
As the Index shows, the ASEAN regulatory framework for data security stays unevenly regulated. For example, Singapore, Malaysia and the Philippines were the primary to adopt data protection laws, while Thailand and Indonesia did so only in 2022. Vietnam plans to pass a knowledge protection law by 2024. In addition to data protection, there are legal differences in de minimis provisions (the minimum value of products below which no customs or border taxes are levied), taxes, subsidies, industrial policy, competition or antitrust policy and placement data.
This disparity also occurs in less developed countries similar to Indonesia. In July 2022, an opinion survey conducted by the ISEAS-Yusof Ishak Institute and the Indonesian Research Institute (LSI) confirmed the findings of Indonesia’s digital divide. According to the study, this division is especially clear amongst populations with different levels of education. For those with primary education or less, lower than one third and lower than 10% respectively have access to the web via mobile and glued broadband. In contrast, 92% and over a 3rd of individuals with a university degree or equivalent respectively use mobile and glued broadband to access the web.
ASEAN could deal with the three key areas and motion plans outlined below to attain a sustainable digital future.
First, create a trustworthy and integrated digital marketplace. In a more integrated regional digital economy, ASEAN could prioritize setting data protection standards and regulatory harmonization to make sure equitable advantages sharing amongst all AMS and every kind of companies. ASEAN could provide capability constructing and technical assistance to the lagging AMS. To start with, ASEAN plans to attain three specific deliverables under Indonesia’s leadership: the ASEAN QR Code as a standard digital payment and currency, a digital lending platform to match potential investors and lenders, and Wiki Entrepreneurs as a one-stop digital platform for ASEAN micro and small enterprises.
Secondly, we want to create a digitally inclusive society. ASEAN could prioritize accelerating universal access to digital connectivity (particularly 4G and glued broadband) and preparing current and future staff for rapidly changing digital transformations, while ensuring that existing labor laws, definitions and standards are well-referenced adapted to the changing nature of workplaces. ASEAN could also develop consumer rights and protection standards which might be interoperable across ASEAN. Given concerns in regards to the impact of digital transformation on mental health, ASEAN may consider developing a mental health charter.
Third, create a digital government service delivery system. ASEAN could prioritize the event of a digital identification system for all AMS, with the goal of achieving regional interoperability for national identification systems. ASEAN could pursue a mutually recognized electronic identification, just like the EU’s eIDAS (electronic identification, authentication and trust services) system, and work towards implementing the one-off principle (OOP). With such an integrated identification system, an ASEAN citizen can be required to offer certain standard identification information “just once” to regional authorities and administrations. ASEAN could also establish a standardized digital public service delivery (PSD) platform. Finally, citizen e-participation could function as a feedback mechanism.
Given that the digital future is just across the corner, Indonesia’s ambitious plan to launch ASEAN DEFA and move closer to ASEAN’s digital future is commendable. Discussions were also held on establishing an ASEAN Digital Community by 2040. To realize its plans, Indonesia’s ASEAN Chairmanship could deal with specific deliverables similar to the ASEAN QR Code within the short term, while laying the groundwork for future ASEAN Chairs to proceed its activities in the long run through a trusted and integrated regional digital marketplace, more inclusive, digitally connected societies and digital government systems. ASEAN might have to set short-term goals to fulfill tougher long-term goals, similar to regional interoperability of national identification systems. Domestic obstacles, specifically the intractable civil war in Myanmar, in addition to broader geopolitical realities, specifically the US-China technology divide, will pose significant risks to ASEAN’s digital integration.
Source: fulcrum.sg
