Monday, 18 Dec 2017

Challenges from digital economy for ASEAN Economic Community

Updated at Saturday, 04 Feb 2017, 09:57
The Hanoitimes - The Southeast Asia (ASEAN) is the world`s fastest growing internet region. However, ASEAN nations are facing with three major challenges in the digital technology, including localized data, ensuring of network security and the assurance of data privacy.
The ASEAN is the world's fastest growing internet region. In the next 5 years, every month there will be more 4 million internet users. Beside opportunities of the power of digital technology, the region is facing with three major challenges, including localized data, ensuring of network security and the assurance of data privacy.
According to many experts, the  digital technology plays a key role in developing the ASEAN Economic Community (AEC).
The AEC's market with more than 600 million people ranks second in the world in attracting investment and the third in global internet use. By 2020, the number of internet users in AEC will reach 480 million compared to 260 million at present.
Illustrative image
Illustrative image
Making an assessment of this field, Mr.Jeff Pirie - AEC Manager in the Southeast Asian nations and Singapore, said that the small- and medium-sized enterprises (SMEs) in ASEAN generate 70% of jobs in the region, however they contribute only 30% of the bloc's GDP, far lower than SMEs in the European Union (about 58%).
Vietnamese firms, especially SMEs, should take advantage of the power of digital technology to boost sales and improve competitiveness, he noted.
Meanwhile, Head of VCCI’s legal department Dau Anh Tuan said the use of internet among SMEs increased significantly in the past decade, with 95 per cent of businesses using the internet last year.
Businesses with effective IT applications have easier access to information about the Government’s policies and laws and are able to comply with administrative procedures more quickly. They also have better business performance, he said.
The use of internet among SMEs has created more favourable conditions for businesses to expand markets and reduce operation costs, according to Mr.Nguyen Thanh Hung, Chairman of Vietnam E-Commerce Association.
A survey conducted by the Vietnam Chamber of Commerce and Industry (VCCI) of 10,000 SMEs showed that digital technology has had a tremendous impact on Vietnamese businesses.
But nearly 60 per cent of them reported ineffective use of information technology, Tuan added.
“Study after study shows that small businesses do better when they establish a strong web presence. They can grow sales up to four times faster than their offline competitors when they embrace the web and digital tools, especially on mobiles,”, he noted.
In fact, the ASEAN nations have not taken full of huge advantages from the digital technology in order to develop their economies.
According to Mr. Stuart Schaag, a senior official from the US Trade, the AEC should enhance connectivity so as take advantage of digital economy.
Mr. Michael Michalak from the ASEAN-American Business Council stressed the free flow of data, which is an important element of the digital economy.
Governments of ASEAN countries need to create a common, unified,  and safe digital environment, he suggested.
Moreover, online paying is very important in the digital economy, particularly cross-border payments. Therefore, Governments in the ASEAN region should jointly create a freer and safer legal environment for payments, Michael Michalak added.
Translated by Thu Minh
Source: Nguyen
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