Digital Trade in ASEAN

There are significant benefits from the use of digital technologies and across the Association of Southeast Asian Nations (ASEAN) region, governments are developing their domestic digital economies and seeking trade opportunities to increase the scale, speed, and scope of trade. Specifically, governments have been ramping up efforts to digitalise in response to COVID-19. Governments are increasingly looking at digital technologies, applications and hardware as way of reaching citizens and ensuring the continuation of existing government services during the pandemic. At the same time, governments have used this opportunity to bring forward any future plans to develop the digital economy, and review and revise plans to improve government processes, streamline resources, broaden delivery of public services, facilitate trade and deploy smart technologies to improve citizen’s lives. These strategies, national plans, and initiatives employed by ASEAN Member States (AMS) are typically mid- to long-term activities designed to meet the country’s policy goals.

However, as governments accelerate their digital initiatives, they are also faced with unprecedented socioeconomic pressures: the pandemic has pushed economies into recession; unemployment levels are soaring, and the operating budgets of government agencies and departments will become tighter. It is in this context that AMS roadmaps have been created to outline where international standards can advance and accelerate impact and opportunity, as the region begins emerging from the pandemic.

Regional approach to digitalisation

A number of regional initiatives, policies and programmes have been implemented to reap the benefits of digital trade between AMS. Notable examples of long-term plans and some related to COVID-19 economic recovery include:

  • ASEAN Digital Integration Framework which enables AMS to prioritise existing policies to facilitate seamless digital integration. It focuses on policies related to digital connectivity and affordable access, financial ecosystems, commerce, trade and workforce transformation.[1]
  • ASEAN Strategic Action Plan for SME Development 2025[2] which seeks to address the challenges SMEs face in terms of access to finance and technology.
  • ASEAN Digital Masterplan (ADM) 2025[3] which envisions ASEAN as a leading digital community and economic bloc.  The plan includes measures to leverage telecommunications services and electronic commerce to help facilitate cross-border trade. [4]
  • ASEAN Data Management Framework (DMF) and Model Contractual Clauses for Cross Border Data Flows (MCCs) are key resources and tools for ASEAN businesses to utilise in their data-related business operations.[5]
  • ASEAN Agreement on E-Commerce seeks to develop and grow the ecommerce sector by advancing trade rules like consumer protection, cross-border data flows and logistics.[6]

More recently, as part of the ASEAN Community Post-2025 Vision efforts are being made to promote coherence, inclusiveness and participatory approach and allowing for greater engagement and consultations with relevant stakeholders of ASEAN.[7] Such efforts will be important in reducing the rising inequalities that are emerging in ASEAN as a result of COVID-19.

Driving digital trade through international standards

AMS have a range of policies, regulations, and programs in place to facilitate different aspects of digital trade including:

  • Broad digital trade growth (e.g., masterplans, guidelines, or programs including a focus on upskilling and ensuring the digital transformation of MSMEs);
  • Foundational digital trade enablement (e.g., wireless communication and infrastructure; digital ID; data protection and privacy; and cybersecurity);
  • Digital trade logistics (e.g., cross-border logistics platform such as enablement of national single window; last mile delivery; e-commerce; e-invoicing);
  • Digital trade purchases and ordering (e.g., financial messaging and payments standards, APIs, QR codes, e-procurement);
  • Emerging digital trade areas (e.g., smart cities; artificial intelligence (AI); 5G; blockchain; Internet of Things (IoT); 3D printing; autonomous vehicles (AVs); and
  • COVID-19 response and recovery efforts, particularly as they relate to digital trade enablement.

The above initiatives aim to achieve the eight desired outcomes of the ADM 2025, namely to: i) speed ASEAN’s recovery from COVID-19; ii) increase the quality and coverage of fixed and mobile broadband infrastructure; iii) deliver trusted digital services and prevent consumer harm; iv) ensure a competitive market for the supply of digital service; v) increase in quality and use of e-government services; vi) facilitate cross-border trade; vii) increase capacity of businesses and people to participate in the digital economy; and viii) develop a digitally inclusive society in ASEAN.

Alignment to international standards can support these outcomes. Standards bring benefits to businesses in terms of substantially larger (potentially global) markets, reduced costs, standardised processes and compliance, as well as enhanced productivity. Standards can also provide more users with access to digital technologies and applications thereby facilitating inclusivity whether it be financial inclusion or digital inclusion.

Priority Areas

There are a number of key focus areas and nascent sectors that need to be prioritized, where AMS can cooperate on international standards to enhance and drive digital trade. Further examination of these identified priority areas will be mapped out in market reports, where standards that are open and adaptable (and provide rich data) within each of the prioritized key focus areas for the AMS will be identified and recommended for prioritization. For some AMS, this may include a focus on:

  • Foundational aspects of digital trade (e.g., data protection and privacy);
  • Facilitation of digital trade (e.g., national single windows, e-invoicing, digital ID); and/or
  • Focus on key digital technologies (e.g., AI, 5G).
The potential for digital trade growth in ASEAN
The potential for digital trade growth in ASEAN (1/2)
The potential for digital trade growth in ASEAN
The potential for digital trade growth in ASEAN (2/2)

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