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ASEAN rising – IT key to new common market

ASEAN rising – IT key to new common market
2015-07-012015-07-01emerging marketsen
Residents of the European Union (EU) have long enjoyed the free movement of labor, trade and citizens across the region’s borders, being able to travel freely from nation to nation for work or play.
Published July 1, 2015 by Steve Harris in emerging markets
going global

Residents of the European Union (EU) have long enjoyed the free movement of labor, trade and citizens across the region’s borders, being able to travel freely from nation to nation for work or play. Now ASEAN, the Association of Southeast Asian Nations, is set to implement its own, similar, relaxed borders scheme, and the possibilities and opportunities abound. But is it set to become the new EU?

The ASEAN Economic Community (AEC) initiative will impact the region – comprising Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam – much like the European Economic Community (EEC) did to the EU, creating a single, regional common market covering more than 600 million people, and powered by a free flow of products, services, investment capital and skilled labor. The numbers are significant; a $2.4tn south-east Asian marketplace will make ASEAN the seventh largest market in the world, it is home to 10 percent of the world’s population and its combined economy is forecast to grow 5 percent per year to 2018, surpassing the US, EU and Japan.

Technology supporting transformation

All this new activity and movement needs the appropriate technological infrastructure to support it. The recent news that a new high speed undersea cable is being built to connect Malaysia, Cambodia and Thailand is just the latest step in bringing the ASEAN region’s infrastructure up to the level of the rest of AsiaPacific. It represents the first time Cambodia will be connected to a high speed undersea cable, while neighboring nations Myanmar and Laos will also be able to tap into the pipe, helping connect their economies to the rest of the region and the wider world.

ICT is at the heart of ASEAN’s transformation and move towards a more liberal social and commercial structure – like much of Asia, ASEAN has a burgeoning middle class who want and expect to be able to use the latest technology on their terms. As such the Community has put in place an ICT Master Plan, an ambitious strategy focused on coordinating investment in infrastructure to help bridge the digital divide that exists throughout ASEAN. The Plan emphasizes the importance of information security, intellectual property rights and also the uses and advantages ICT can bring to education, health and government. Ultimately the Plan is designed to foster economic growth and help the region to flourish as a whole.

Steady growth, set to spike

Economic integration throughout ASEAN in the past decade has helped encourage a general trend for ICT uptake and proliferation of mobile devices, hardware and services. This has then had the knock-on effect of assisted technology purchasing patterns, trade between member states and investment, resulting in an average rise in ASEAN’s GDP of over 6 percent for the bulk of the past decade.

ASEAN member countries rode out the global financial crisis of 2008 better than most, and both telecoms and technology companies in the region continued to invest. LTE and other 4G mobile upgrades took place, big data solutions were developed and implemented, and mobile network operators such as Singapore’s SingTel and Malaysia’s Axiata continued to invest in and grow projects in Thailand, Indonesia and elsewhere.

Opportunities for all

The ultimate outcome for ASEAN is that the relaxing of regulations and borders should have a positive impact for all. ASEAN has many strengths upon which to draw as it seeks to become a major player on the global economic stage, and the opportunities if exploited correctly could be huge. A recent McKinsey study identified five digital technologies that are set to create substantial major economic growth in ASEAN; mobile Internet, big data, the Internet of Things, automation of knowledge work and cloud technology. Between them these disruptive technologies could bring as much as $625 billion per year in economic impact by 2030. Exciting times indeed.

Planet Local - Going global with Orange Business Service

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