Author: Satvinder Singh*
The ASEAN Economic Community is celebrating one other significant achievement on its digital transformation journey. The World Summit on the Information Society (WSIS) has just awarded ASEAN the best WSIS Award within the “International and Regional Cooperation” category in recognition of its initiative on the ASEAN Data Management Framework (DMF) and the ASEAN Model Contractual Clauses (MCC). for cross-border data flows. This is a recognition of ASEAN’s contribution to the United Nations Sustainable Development Goals that ought to be celebrated and discussed.
The digital economy will play an increasingly necessary role within the post-pandemic world, especially in Southeast Asia. Since the outbreak of the Covid-19 pandemic, ASEAN has added 60 million latest digital consumers, making the region its third-largest web base with almost 400 million web users. ASEAN’s digital revenue increased from $117 billion in 2020 to $174 billion in 2021 and is anticipated to achieve $363 billion by 2025. As a result, ASEAN’s digital economy is projected to grow significantly and is estimated to achieve a regional GDP of $1 trillion by 2030. Given this potential, ASEAN must focus more on the digital sector to ride the wave of growth within the region and ensure its continued sustainability, including through the ASEAN Digital Economy Framework Agreement (DEFA), which we hope to enter into negotiations by 2025.
ASEAN must recognize the importance of information as a fundamental element of the digital economy. Data-driven services have change into the brand new engine of economic growth. For example, data-driven applications of artificial intelligence are expected to generate $13 trillion in latest global economic activity. However, unlocking the worth of information is just not easy. Data only has value when it’s transformed into insights, applications and services – a process that has traditionally only taken place inside individual corporations. In the information economy, this process is becoming increasingly interconnected, based on the usage of advanced technologies to access and process high-quality data, which regularly resides in a couple of organization or country.
As corporations increasingly digitize their processes, data collection, processing and storage will change into commonplace. However, not all corporations are equipped with the obligatory data processing and management capabilities, especially when such exchanges happen across borders. For ASEAN, maximizing the worth of information also means ensuring that small and medium-sized enterprises (SMEs) have the chance to construct data capability, as they constitute 95-99% of all enterprises and account for greater than half of total employment in all ASEAN countries. A recent study shows that while 75% of small and medium-sized enterprises in ASEAN see opportunities from participating within the digital economy, only 16% are fully leveraging digital technologies. Moreover, protecting data and facilitating its flow is becoming a crucial element of the data-driven economy. This stays a serious challenge in ASEAN because of different regulatory regimes regarding personal data protection practices and cross-border data sharing. These growing fragmentations often hamper the event of ASEAN’s data economy.
Given these challenges, a unified approach to digital data management is essential, with greater emphasis and recognition of the porous nature and interdependencies amongst ASEAN countries in the information economy. This is why the ASEAN DMF and MCC developed by the ASEAN Working Group on Digital Data Management are necessary. ASEAN DMF helps enterprises, especially SMEs, put in place a governance structure to administer the information of their care. Moreover, adopting MCC will even help businesses incorporate terms into business contracts to legally transfer personal data across borders. These initiatives function drivers for the region’s next stage of digital development and form the idea of the upcoming ASEAN DEFA. They provide a stronger mechanism for the free flow of information across borders and ensure greater protection of non-public data, which in turn provides an enabling environment for businesses to develop latest services and products based on data-driven innovation.
Going forward, to seize the opportunities presented by the information economy, ASEAN must proceed to work on constructing organizational capability and a talented workforce, harnessing the ability of recent technologies, and harmonizing regulations to develop a typical legal framework across the region. This will include increasing the adoption of DMF and MCC to make sure the region deepens cross-border integration of the digital economy. With a unified approach to unlocking data opportunities, ASEAN can strengthen its cooperation to thrive together within the digital era, which can position it well to interact with dialogue partners.
*HE Satvinder Singh is ASEAN Deputy Secretary-General for the ASEAN Economic Community.
