The ASEAN Digital Economy Framework Agreement (DEFA) holds much potential to accelerate the region’s digital transformation, with a view towards economic integration, strengthening competitiveness and advancing sustainable economic development. As part of the “Acceleration Phase” of the Bandar Seri Begawan Roadmap, DEFA aims to accelerate trade, enhance interoperability, and enable a safer, more inclusive online environment for businesses and consumers. Expectations for DEFA are high. The study commissioned to inform the negotiations projected that a “North Star” DEFA could double the projected $1 trillion digital economy by 2030.
The Negotiating Committee, comprising representatives from all 10 ASEAN Member States (AMS), started work in November 2023 to establish progressive rules on nine areas including digital trade, e-commerce, cybersecurity, cross-border data flows, data protection and emerging technologies like artificial intelligence. One year into the negotiations, which are targeted to conclude by 2025, the Chair of the ASEAN DEFA Negotiating Committee, Ms Prewprae Chumrum, Executive Director of the Bureau of Trade in Services and Investment Negotiations at the Ministry of Commerce of Thailand, shares her thoughts on DEFA’s potential to reshape Southeast Asia’s digital economy.
[TFGI] As we enter the second year of negotiations for the ASEAN Digital Economy Framework Agreement (DEFA), could you share your reflections as Chair of the Negotiating Committee?
It has been an exciting year, and I have witnessed strong political will from ASEAN Leaders and Economic Ministers, which has translated into the collective commitment of the DEFA Negotiating Committee. We are building DEFA as a forward-looking, high-standard, and comprehensive agreement that responds to the rapidly evolving digital landscape. Our primary goal is to advance on existing frameworks and establish new standards for digital cooperation. While AMS are at different stages of readiness, they remain dedicated to making DEFA a modern, future-proof foundation for the region’s digital economy.
[TFGI] DEFA was launched with the ambitious goal of unlocking up to USD 2 trillion ASEAN digital economy by 2030. What do you consider to be the key enablers for unlocking the region’s digital potential?
To reach the target of a USD 2 trillion digital economy, several foundational enablers must be addressed across ASEAN. First, enhancing digital infrastructure is essential. This includes ensuring reliable internet connectivity, which is crucial for seamless cross-border digital trade and services. Second, advancing digital literacy and workforce readiness is vital, as we need to equip citizens and businesses with the skills required to thrive in the digital age. Third, harmonising the regulatory framework across ASEAN is crucial—streamlining policies to reduce barriers and build trust between AMS. These enablers will provide the necessary foundation to create a digital ecosystem that supports innovation, business growth, and inclusive development.
[TFGI] What are the main challenges in aligning these enablers across such a diverse region?
There are three main challenges we must address:
- Digital Infrastructure Gaps: ASEAN countries have varying levels of digital infrastructure, which presents a challenge to creating a uniform environment for digital trade. While some countries are more advanced, others still have significant gaps. Bridging this divide will require targeted investments and alignment of policy priorities.
- Workforce Skills Gaps and Digital Literacy: The demand for digital talent is growing rapidly, especially in emerging fields like AI, machine learning, and cybersecurity. However, there is a shortage of skilled professionals across the region. We need to collaborate more closely with the private sector, educational institutions, and governments to equip people with the skills needed to meet the demands of the digital economy.
- Regulatory Harmonisation: Every AMS has its own set of regulations, particularly in areas like data privacy, digital taxes, and cybersecurity. Harmonising these frameworks across the region requires shared aspirations, mutual trust, and sometimes legal adjustments. Our goal is to ensure interoperability between these diverse regulatory environments, which is essential for facilitating cross-border digital trade.
[TFGI] As technological advancements continue at a rapid pace—particularly in areas like AI and quantum technology—how do you ensure that DEFA remains flexible and future-proof?
This is a crucial point. ASEAN is fully aware of the rapid pace of technological advancements and the risk of creating an outdated agreement. To future-proof DEFA, we need to ensure flexibility in its structure. One approach is through “technology-neutral commitments,” which will set high-level standards that remain relevant over time while accommodating emerging technologies. Additionally, we are considering guiding principles focused on openness, interoperability, and resilience—values that will continue to hold importance as technology evolves. We may also include review clauses and consultation mechanisms to ensure that DEFA can adapt to changes in the digital landscape as needed.
[TFGI] Given ASEAN’s diversity, how do you balance ambition with feasibility when navigating the implementation of DEFA across AMS?
As Chair of the Negotiating Committee, I advocate for an ambitious DEFA that can unlock the digital transformation potential of ASEAN. However, I am mindful that AMS are at different levels of readiness, especially in terms of infrastructure, legal frameworks, and regulatory environments. We must ensure that all countries are able to implement their obligations under DEFA. This requires a pragmatic approach that includes flexibility and adjustment mechanisms for those who may face challenges. We want to ensure that DEFA is inclusive and that no one is left behind.
[TFGI] DEFA stems from the broader ASEAN Economic Community (AEC) framework. Do you see the agreement facilitating deeper collaboration across ASEAN in other areas, such as political-security and socio-cultural cooperation, in the digital age?
Certainly. While DEFA is primarily driven by the economic pillar of the ASEAN Economic Community, its impact will extend beyond economics. The frameworks we establish for mutual trust, shared standards, and data security will directly impact political and security collaboration, particularly in areas like cybersecurity and cross-border data governance. On the socio-cultural front, DEFA has the potential to promote inclusivity by improving digital literacy, fostering entrepreneurship, and enabling greater connectivity between people across the region. By enhancing digital infrastructures and adopting common digital standards, we can boost social welfare and create a more integrated ASEAN.
[TFGI] As we move into the second year of negotiations, what is your call to action for non-governmental actors such as the private sector, academia, and civil society?
The DEFA Negotiating Committee will continue to engage with stakeholders in the second year of negotiations, and we welcome input from the private sector, academia, think tanks, and civil society. Insights from business communities help us understand the real-world impact of DEFA’s obligations on enterprises. Additionally, collaboration with academic institutions and think tanks has provided valuable data and research that guide the negotiation process. I encourage all stakeholders to continue participating actively, as their perspectives help ensure that DEFA remains relevant and effective.
[TFGI] Finally, what is your vision for ASEAN’s digital cooperation and integration by 2025?
As ASEAN advances toward a comprehensive digital economy with the upcoming ASEAN Vision for Post-2025, it’s clear that the digital era will be a key driver of our economic growth. This transformation will make ASEAN more innovative, inclusive, and resilient. My goals for digital cooperation and integration across ASEAN by 2025 are as follows:
- Create a vibrant, interconnected digital ecosystem that empowers individuals, businesses, and governments, with seamless connectivity across the region. Ensuring access to reliable, high-speed internet will be crucial for digital economy participation.
- Establish interoperable digital services to facilitate cross-border commerce, data sharing, and communication, streamlining processes and enabling collaboration among businesses and citizens.
- Prioritise cybersecurity resilience to protect critical infrastructure and personal data.
- Foster innovative ecosystems that drive entrepreneurship and support micro, small, and medium enterprises (MSMEs). By encouraging collaboration between the private sector, academia, and government, we can enhance research and development, creating region-specific solutions.
In conclusion, I envision ASEAN in 2025 as a digitally integrated community that empowers everyone and is ready to connect with other regions.
