From Left to right: Dr. Ming Tan, Founding Executive Director, Tech for Good Institute; His Excellency Satvinder Singh, Deputy Secretary-General of ASEAN for ASEAN Economic Community, Will Nankervis, Ambassador of the Australian Mission to ASEAN, Prewprae Chumrum, Chair of the ASEAN DEFA Negotiating Committee and Executive Director of the Bureau of Trade in Services and Negotiations, Thailand.
The ASEAN Digital Economy Framework Agreement (DEFA), expected to be the world’s first regionwide digital economy agreement, seeks to realise Southeast Asia as an integrated, innovative, interoperable and investable region. DEFA aims to provide a comprehensive roadmap to accelerate digital trade, govern data, promote digital innovation, and drive productivity-led, inclusive growth. This framework agreement is timely, given Southeast Asian economies have become more digitised, digitalised, data-driven and digitally-integrated. It is projected that the agreement will unlock $2 trillion in the region’s digital economy, which further enhances Southeast Asia’s standing as an attractive economic bloc. The first DEFA negotiation meeting commenced 1 December 2023, and negotiations are expected to conclude in 2025.
To ensure DEFA delivers the desired outcomes for all ASEAN member states, enables a safe and vibrant digital ecosystem, and serves the needs of citizens and businesses, there is a need and an opportunity to institutionalise a multi-stakeholder and consultative process. In line with this, the 10th ASEAN Economic Community Dialogue convened government officials, business leaders, civil society, investors and academics to discuss policy implications of the agreement and the aspirations of the private sector for DEFA.
Read on for key takeaways from the first panel discussion at the 10th ASEAN Economic Community.
Panel Discussion 1: Policy Implications of the ASEAN DEFA to Digital Ecosystem
ASEAN DEFA is a foundational agreement for seamless and secure regional flow of goods, services and data in Southeast Asia. Crucial to the agreement is the alignment of enabling rules and regulations for various pillars of digital integration including payments, trade, infrastructure and talent. However, ASEAN member states are in various stages of digital development, with their own respective domestic laws governing the digital economy. The DEFA will have policy implications with respect to the operating environment of businesses, including MSMEs.
This panel discussed the key policy issues that should be considered during the DEFA negotiations that would align enabling laws, foster a reasonable and effective compliance environment for businesses and ensure MSMEs are not left behind as the region progresses towards digital regional integration.
From Left to right: Dr. Ming Tan, Founding Executive Director, Tech for Good Institute; Theodore Sutarto, Assistant Deputy Minister, Coordinating Ministry for Economic Affairs of the Republic of Indonesia; Athita Komindr, Head, UNCITRAL Regional Centre for Asia and the Pacific; Josh Lee, Managing Director, APAC, Future of Privacy Forum
On screen: Tan Lay Lin, Director, International Trade Cluster Division, Ministry of Trade and Industry, Singapore
Moderator and panellists:
- Dr. Ming Tan, Founding Executive Director, Tech for Good Institute
- Athita Komindr, Head, UNCITRAL Regional Centre for Asia and the Pacific
- Josh Lee, Managing Director, APAC, Future of Privacy Forum
- Tan Lay Lin, Director, International Trade Cluster Division, Ministry of Trade and Industry, Singapore
- Theodore Sutarto, Assistant Deputy Minister, Coordinating Ministry for Economic Affairs of the Republic of Indonesia
Despite diverse levels of digital development and policy environment, the DEFA can be a landmark agreement that sets the pathway towards inclusive regional integration in Southeast Asia.
- Navigating an Open Standards Paradigm for an Inclusive ASEAN Digital Economy
The discussion emphasised the need for open standards and principle-based approaches to shape an interoperable ASEAN DEFA, departing from prescriptive regulations. This aligns with the dynamic digital economy, fostering collaboration, adaptability, and inclusivity. Panellists highlighted leveraging international standards for compatibility, discouraging exclusivity, and promoting a more interconnected ASEAN digital landscape. Adhering to principle-based approaches allows DEFA to accommodate diverse needs and establish a foundation for seamless cross-border integration and collaboration.
- Gradual Harmonisation and Legal Frameworks vital for Digital Integration in ASEAN
The discussion highlighted the importance of gradual harmonisation and legal frameworks in navigating digital integration in ASEAN. Drawing inspiration from UNCITRAL’s progressive approach to international trade law modernisation, the conversation stressed the need for a measured approach to address the complexity of digital trade. This ensures that legal frameworks evolve with technological advancements, allowing DEFA to establish a strong foundation for future digital trade while accommodating diverse ASEAN member state needs.
- Advocating a Modular Approach and Regulatory Sandboxes
The panel highlighted the importance of practical implementation and experimentation in DEFA, advocating a modular approach with pilot projects to refine concepts like digital identity and data transfer. This practical experimentation, resembling regulatory sandboxes, offers a risk-mitigated space for innovation. Engaging governments and private sectors in cross-jurisdictional sandbox corridors enables DEFA to foster collaborative learning, helping stakeholders navigate uncertainties and develop effective strategies. This approach ensures a responsive and adaptable digital ecosystem where policy and technology evolve collaboratively.
- Prioritising Equitable Development in ASEAN
The imperative of inclusive growth and equitable benefit distribution within ASEAN emerged as a core theme. Panellists emphasised bridging developmental gaps among member states, proposing collaborative efforts and tailored assistance mechanisms, including technical and financial support for capacity building, infrastructure development, and digital talent cultivation. DEFA’s success depends on narrowing disparities, enabling all member states to partake in digital transformation, and ensuring benefits are accessible to individuals and enterprises across ASEAN for sustainable growth.
In summary, the discussion emphasised the need for a global perspective and future readiness in shaping the ASEAN DEFA. Panellists advocated for aligning digital frameworks with international developments, monitoring advancements in AI governance and data protection. This proactive approach ensures DEFA’s adaptability on a global scale. By aligning with global standards and fostering partnerships beyond the region, ASEAN can position itself as a leading participant in the global digital economy, enhancing its competitiveness and relevance.
Read the 10th ASEAN Economic Community Dialogue press release for more information.
Watch the summary of the ASEAN DEFA video below:
The dialogue is held with the support of the Australia for ASEAN Futures – Economic and Connectivity (Aus4ASEAN Futures (ECON)) and with the Tech for Good Institute as the knowledge partner.