To drive post-Covid-19 economic recovery, Asean must remove barriers to its digital sector
- Onerous content and licensing regulations and restrictions on data flow will hinder the development of the region’s growing internet economy
- Asean member states must build on recent agreements to take on more binding commitments on cross-border data flows
The good news is that Asean is well placed to leverage the potential of its digital economy to drive recovery efforts. In 2019, Southeast Asia’s internet economy hit US$100 billion, more than tripling in size over the preceding four years. By 2025, the region’s internet economy is expected to grow to US$300 billion.
The internet economies of Malaysia, Thailand, Singapore and the Philippines are growing by between 20 per cent and 30 per cent annually. Indonesia and Vietnam are the markets to watch – they boast growth rates in excess of 40 per cent a year.
Asean member countries need to work together to develop smart, forward-looking policies that stimulate the digital economy by spurring innovation, encouraging greater entry and participation of small and medium-sized enterprises and entrepreneurs, and empowering businesses with the ability to grow and invest for the future.
Free cross-border data flows are critical to overall economic growth. According to the McKinsey Global Institute, over a decade, global flows of all types acting together have raised world GDP by 10 per cent over what would have resulted in a world without any cross-border flows. This value amounted to some US$7.8 trillion in 2014 alone, and data flows account for US$2.8 trillion of this impact.
