How Streamlined Regulations Are Boosting ASEAN's Path to a $2T Digital Economy by 2030, Featured on ZDNET

How Streamlined Regulations Are Boosting ASEAN’s Path to a $2T Digital Economy by 2030, Featured on ZDNET

The framework aims to facilitate seamless cross-border online trade and make it easier to do business within the region.

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Asean member states are working to establish protocols that will ease cross-border digital trade and help to address emerging trends, such as artificial intelligence (AI).

Targeted to be completed by 2025, the Asean Digital Economic Framework Agreement will improve digital rules across key areas, including digital trade, cybersecurity, payments , and data . The framework aims to facilitate seamless cross-border online trade and make it easier to do business within the region, said Singapore’s Ministry of Trade and Industry (MTI) in a statement last Sunday.

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Asean comprises 10 member states, including Indonesia, Thailand, the Philippines, and Malaysia. Ministerial representatives had gathered in Indonesia’s capital Jakarta over the weekend for the Asean Economic Community (AEC) Council Meeting.

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A “high-quality” Asean digital economy framework has the potential to double the region’s digital economy from $1 trillion to $2 trillion by 2030, said MTI, citing research by the Boston Consulting Group (BCG). Commissioned by the Asean member states, the study polled more than 2,000 micro firms and small and midsize businesses (SMBs), and included insights from 60 business leaders at large enterprises.

BCG forecasts Asean’s collective GDP will grow by almost 4.6% every year for the rest of the decade, with the trade bloc set to be the world’s fourth largest by 2030. With nominal GDP at $3.6 trillion, the region has a total population of 685 million, of which more than two-thirds are of working age.

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At the Asean council meeting, member states underscored the need to boost regional economic integration amid a challenging global economic landscape . The council stressed the importance of “refreshing” existing trade processes and improving their implementation to ensure a robust future for Asean.

Singapore’s Minister for Trade and Industry Gan Kim Yong said: “In an increasingly uncertain global trading environment, it is important that Asean remains committed to deeper economic integration, including in the energy sector, to unlock the region’s potential.

“Ongoing work on the AEC’s post-2025 vision and refreshing the AEC’s processes will continue to ensure the region is well positioned to capture opportunities amid greater economic volatility and disruptions,” Gan said. He added that the digital economy framework will facilitate closer collaboration and move Asean closer toward “an open, secure, and competitive” regional economy.

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The framework will also enable the region to continue to “democratize” access to digital technologies through the cloud, said Annabel Lee, Asean director for public policy at Amazon Web Service , in the MTI statement. “Promoting data free flow with trust, setting high standard digital trade rules, and encouraging consistent regulatory standards across Asean will particularly benefit startups and SMBs,” Lee said.

Robert Yap, Executive Chairman of logistic company YCH Group, said: “The Asean Digital Economy Framework Agreement would provide Singapore companies trading and investing in the region with greater transparency and interoperability in cross border e-commerce and digital economy sectors.”

Asean companies, including micro firms and SMBs, would benefit from greater data flows and integration of electronic payments, which would boost innovation and economic growth in the region, said Yap, who is also chairman of the Asean Business Advisory Council Singapore.

Five Asean central banks inked a pact last November to boost connectivity and facilitate speedier cross-border payments across their markets, including Singapore and Indonesia. The Regional Payment Connectivity agreement was touted as an important move to drive economic recovery and inclusive growth across the Asean region, with cross-border payment connectivity seen as being key to facilitating trade, investment, tourism, and other economic activities.

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Asean member states have also championed efforts in cybersecurity with pledges to drive further collaboration , including plans to adopt common standards and best practices. The trade bloc has subscribed, in principle, to the United Nations’ (UN) 11 voluntary, non-binding norms of responsible state behavior in cyberspace.

Asean states have advocated the need to implement the international cyber-stability framework, stressing the importance of “a rules-based cyberspace” to drive economic progress and improve living standards. Internal laws, voluntary, and non-binding norms of state behavior, as well as practical “confidence-building” measures are essential to ensure the stability of cyberspace, they said.

The Asean Regional Computer Emergency Response Team (CERT) was established in October last year , operating as a virtual center that comprises analysts and incident responders from across member states.