1. Home
  2. |Insights
  3. |4th ASEAN Digital Ministers’ Meeting: Enhancing Digital Trade and Growth in Southeast Asia

4th ASEAN Digital Ministers’ Meeting: Enhancing Digital Trade and Growth in Southeast Asia

Client Alert | 9 min read | 02.09.24

C&M International’s Asia-based digital policy team joined an industry delegation last week at a key gathering to discuss Southeast Asia’s future digital economy. Singapore hosted the 4thASEAN Digital Ministers’ Meeting (ADGMIN) from 30 January to 02 February, 2024 under the theme “Building an Inclusive and Trusted Digital Ecosystem”. Josephine Teo, Singapore’s Minister for Communications and Information, chaired the meeting alongside her counterpart from Thailand, Prasert Jantararuangtong, Minister of Digital Economy and Society as the Vice Chair.

Key themes that were top-of-mind for policymakers and the private sector alike included AI governance, data flows, cybersecurity, digital trade, and digital infrastructure. Member states of ASEAN, the Association of Southeast Asian Nations, encompassing all of the major economic powers in the region, endorsed guidelines and made action-oriented commitments aligned with their vision to create an enabling environment to support the region’s holistic digital transformation.

Below is a summary of official ADGMIN outcomes (from the Joint Media Statement and the Singapore Declaration) related to each of the key themes, along with insights from bilateral dialogues with ASEAN Member States (AMS) and private sector representatives.

I. AI Governance

ADGMIN Outcomes

Member states endorsed the ASEAN Guide on Artificial Intelligence (AI) Governance and Ethics, a holistic governance framework with national and regional-level recommendations for the deployment of trustworthy AI. It is designed as a “practical and implementable tool”, adoption of which is to be supported by a new working group under ASEAN Digital Senior Officials’ Meeting (ADGSOM) on AI Governance. This group will also facilitate collaboration among AMS on the governance of emerging technologies, such as generative AI.

Member States Speak

The creation of this Guide is a crucial step in ASEAN’s forward-looking posture towards AI adoption. On a macro-level, it is intended to promote greater interoperability in the region, thus creating a key economic differentiator to promote ease of doing business. This is to be a multi-stakeholder effort, and there are ongoing discussions to formalize a dedicated platform for stakeholder engagement and consultation. It will facilitate effective information exchange with the private sector and other stakeholders, who can highlight on-the-ground perspectives and evidence that will be critical for effective policymaking.

Private Sector Perspectives

The light touch, risk-based approach reflected in the Guide is welcomed and aligned with a number of governments creating legislation to regulate risk and not the technology. There is a common belief that AI should have accountability and not be immune to liability, and that efforts must be undertaken to promote AI innovation and not a licensing regime. Additionally, policy-led efforts to foster the demand side for AI adoption will also be appreciated. In other words, citizens need to understand the benefits of AI and trust the technology in order to become true adopters.

A challenge unique to a region as diverse as ASEAN is the different levels of digital development across AMS. Layering atop are the varying issues implicated by the cross-sectoral nature of AI – it touches education, health, and jobs/workforce, among others. It will be helpful to have all relevant stakeholders in the room when debating a holistic application strategy for the AI Guide.

II. Data Flows

ADGMIN Outcomes

The meeting unveiled an updated Joint Guide to ASEAN Model Contractual Clauses and European Union (EU) Standard Contractual Clauses, consisting of a Reference Guide and an Implementation Guide. The latter is specifically targeted to businesses and includes guidance and best practices for data transfer between ASEAN and the EU to facilitate compliance with applicable data protection requirements.

Private Sector Perspectives

Facilitation of cross-border data flows will be critical to building a strong digital economy in ASEAN, and the introduction of this Joint Guide is a strong step in the right direction. Now that the pace of digitalization is accelerating, national legislation advocating for data localization can be exceptionally harmful to local businesses looking to utilize the efficiency gains from digitalization and expand into other AMS. Additionally, the prospect of concentrating all data within one country increases the risk for cyber incidents and other data-driven frauds, which is already a top-of-mind concern for businesses.

III. Cybersecurity

ADGMIN Outcomes

The Meeting endorsed the ASEAN Regional Computer Emergency Response Team (CERT) Financial Model. Although details are yet to come, this concluded the finalization of ASEAN Regional CERT implementation details initiated by the Cyber Security Agency of Singapore (CSA) in 2022. CSA had presented the Implementation Paper at the 2ndADGMIN in January 2022 and the Operational Framework at the 3rdADGMIN in February 2023, both of which were successfully endorsed by AMS at those times.

Additionally, the meeting welcomed the establishment of a dedicated ASEAN Working Group on Anti-Online Scam (WG-AS), which was proposed by Thailand last year. WG-AS is envisioned as an important platform for knowledge exchange, threat information sharing, and capacity building to enhance the cyber responsiveness of AMS. Additionally, the Working Group will aid in ASEAN’s ongoing efforts to build trust in network and information security infrastructures.

Member States Speak

This initiative comes on the heels of growing concerns around cybersecurity due to rapid digitalization in the region, especially of critical infrastructure.  Top of mind is how to prevent and mitigate the risks of cyber criminals leveraging emerging technology such as AI.

The ASEAN Regional CERT will collectively enhance AMS’ incident response capability and bolster critical information infrastructure (CII) protection. This is expected to extend to cross-border CII, such as banking and finance, communications, and aviation and maritime. Some regional activities considered under the CERT include joint training sessions; networking AMS’ National CERTs with INTERPOL, industry, and academia; and real-time threat information sharing.

Private Sector Perspectives

Establishment of a regional-level cyber response organization is a welcomed move, as it will support cybersecurity-related capacity building across AMS and – optimistically – could even help harmonize compliance obligations for incident reporting. The industry has worked with the US-ASEAN Business Council to develop the ASEAN Cybersecurity Assessment Model. As a part of this, a baseline report has been created detailing cyber maturity at the regional and national levels, along with establishing a method to measure progress in each country’s cyber journey. This effort is complemented by robust interest from industry to support cybersecurity-related capacity building efforts to build a safer digital society.

IV. Digital Trade

ADGMIN Outcomes

The meeting acknowledged the completion of the Study on the ASEAN Digital Economy Framework Agreement (DEFA), which aims to be the first regional digital economy agreement in the world with binding commitments.  The meeting also acknowledged DEFA’s four overarching priority areas with nine core negotiation topics. DEFA negotiations commenced in December 2023 and are scheduled to be concluded by the end of 2025.

Topics for negotiation are set to include:

  • Accelerating Growth (digital trade, cross-border e-commerce);
  • Driving Interoperability Across ASEAN (payments and e-invoicing, digital ID and authentication);
  • Ensuring Responsible Digital Growth (cross border data flows and data protections, online safety and cybersecurity); and
  • Strengthening Cooperation Between Nations (related to emerging topics, talent mobility and cooperation, competition policy).

Member States Speak

DEFA is expected to double the potential value of the ASEAN Digital Economy from USD 1 trillion to USD 2 trillion by 2030. It is a front-and-center priority for ASEAN and has generated considerable anticipation in the region and beyond, due to the scope of and potential impact from the digital issues covered. There is consensus on the need to engage with external stakeholders, including the private sector, for the provision of technical expertise on subject matters, especially those related to cybersecurity, cross border data flows, and emerging technology beyond AI. AMS wants to be mindful about getting the core issues right for the Agreement to be effective and serve as a helpful benchmark for other economies.

The ultimate purpose of DEFA is to make it easier for AMS businesses to leverage opportunities within the digital economy. It aims to be as actionable as possible, without going after aspirational goals such as harmonizing the rules and regulations of each country. Rather, it will focus on practical measures for promoting interoperability in the region.

Private Sector Perspectives

Given that DEFA aspires to contain legally binding commitments on a range of digital policy issues where AMS tend to have differing positions (e.g., data localization), it will be helpful to understand how the negotiations will reconcile these to arrive at provisions built on consensus.

Additionally, DEFA should account for the range of diverse businesses that may be impacted by provisions in each of the nine negotiating topics. The e-commerce category itself consists of a spectrum of businesses such as online shopping and travel. Consideration should also be given to other cross-cutting policy issues such as non-discrimination of digital products. Experts from the industry are keen on providing capacity building support to highlight the nuances of these differences and other topics as may be helpful. 

V. Digital Infrastructure

ADGMIN Outcomes

The meeting acknowledged the importance of building secure digital infrastructure as a foundation for the region’s digitalization and encouraged the creation of a roadmap for 5G development. Additionally, AMS resolved to build a submarine cable network for regional and global connectivity along with corresponding regional capability to maintain the cables.

Member States Speak

The proper allocation and management of spectrum has been an ongoing effort in AMS; the bloc is also working on resolving allocation issues related to frequencies that are no longer relevant and are being used in older technologies. AMS agrees that digital infrastructure will be critical for ASEAN to be competitive with other countries, which may have more cost-effective and advanced approaches to building relevant infrastructure. Additionally, any approach must be climate-conscious and reflect a sustainable pathway to development.

Private Sector Perspectives

Improvement in ASEAN’s digital infrastructure will be directly proportional to the rate of digital transformation and overall competitiveness in the region. This is especially critical for public sector infrastructure. Adoption of advanced technology such as 5G, 5G mmWave, and WiFi 6E and 7 will help AMS meet the demands from emerging technologies, including AI and Internet of Things (IoT).

Even though products with WiFi 6E and 7 technology are already available, these cannot be deployed across all AMS, as only three of them have opened their 6GHz band till now. Until this is rectified, the remaining seven markets will be constrained by the lower performance levels of the older generation of products.

Engagement with Dialogue and Development Partners

China: Appreciation for the signing of the Memorandum of Understanding (MoU) signed between ASEAN and China on Co-operation in Communications and Digital Technology. The Meeting adopted the ASEAN-China 2024 Digital Work Plan and agreed to jointly develop the China-ASEAN Initiative on Facilitating Cooperation in Building a Sustainable and Inclusive Digital Ecosystem.

Japan: Appreciation for the ASEAN-Japan Digital Work Plan for 2024 on Capacity Building for CERT Cooperation and Cybersecurity Standards in ASEAN to strengthen incident response effectiveness.

Republic of Korea (RoK): Acknowledgement of ongoing projects with ASEAN in digital fields, such as AI, data, and cybersecurity. Appreciation expressed for the ASEAN Cyber Shield Project along with a reinforced commitment to facilitate the 2024 ASEAN-ROK Digital Work Plan.

India: Acknowledgement of progress made under the ASEAN-India 2023 Digital Work Plan through engagement and capacity building activities at India’s Centres of Excellence.

United States: Endorsement of the Concept Note of the ASEAN AI Roadmap project to explore how AI can shape ASEAN and potential areas of focus; additional endorsement of the ASEAN-US Work Plan 2023-2025, which includes cooperation on a range of digital policy issues.

European Union: Endorsement of the ASEAN-EU 2024 Digital Workplan, including further development of the ASEAN Digital Index (ADIX) and other cooperation priorities such as AI governance.

International Telecommunication Union (ITU): Support for the ASEAN-ITU Priority Cooperation Area 2024-2026 and endorsement of the ASEAN-ITU Digital Work Plan for 2024.

ASEAN Plus Three (APT)[1]: Appreciation for the new Strategic Plan for 2024-2026, which includes digital policy areas such as connectivity, transformation, trust and safety, inclusion, and sustainability. Endorsement of the ASEAN-APT Digital Work Plan for 2024.

Next Meeting

The 5thADGMIN is scheduled to be hosted by Thailand in January 2025.

[1] ASEAN Plus Three (APT) includes China, Japan, and Republic of Korea (RoK).

Insights

Client Alert | 2 min read | 11.14.24

SEC ESG Enforcement Is Still Alive

On November 8, 2024 the SEC announced a settled enforcement action against Invesco Advisers, Inc. for making misleading statements about its integration of environmental, social, and governance (ESG) factors into the firm’s investment decisions. Invesco agreed to pay a $17.5 million civil penalty to settle the matter. This enforcement action makes it clear that, even though the SEC dissolved its ESG Task Force, the Commission continues to monitor firms’ statements and representations for misleading statements about ESG....