Skip to content

Southeast Asia seeks greater tech cooperation as U.S.-China rivalry grows – CNBC

People wearing face masks as a preventive measure against the spread of Covid-19 in Singapore.

Maverick Asio | SOPA Images | LightRocket | Getty Images

SINGAPORE — As the ongoing rivalry between the United States and China threatens to split the global technology sector, Southeast Asian countries are championing for digital integration.

Southeast Asia is home to some 400 million internet users and 10% of them went online for the first time in 2020, as the coronavirus pandemic pushed more business transactions to the internet.

The region’s 10-member economic union — the Association of Southeast Asian Nations, or ASEAN — is focused on “technology neutrality” even as the threat of bifurcation lingers, according to Josephine Teo, Singapore’s Minister of Communications and Information.

Technology neutrality refers to individuals and businesses having the freedom to decide which technology is most appropriate and suitable to meet their needs, without being influenced to use particular type of technology.

“This threat has not gone away even with Covid-19 having disrupted all of our economies,” Teo told CNBC’s Martin Soong during a panel discussion at the Asia Tech x Singapore conference on Tuesday.

She explained that as economies recover from the pandemic, their dependencies on digital technologies will continue to grow, which will heighten the stakes and make international cooperation more valuable.

Instead of technology bifurcation, we are actually seeking to have more interoperable systems and standards.

Josephine Teo

Singapore’s Minister of Communications and Information

“So, rather than to be caught in these kinds of crosshairs — which is very, very dicey for everyone involved — we should be seeking more partnerships, not less,” she said. “I think that is how we approach the issue within ASEAN and certainly with all of our dialogue partners, we hope that we can build on the approach and the spirit of partnership.”

Tensions between Washington and Beijing heightened under the previous U.S. administration. But President Joe Biden has kept many restrictions on Chinese tech companies that were imposed by his predecessor Donald Trump.

ASEAN’s digital transformation

The level and prevalence of technology in ASEAN varies by member states.

As part of its digital masterplan, the bloc aims to make significant strides toward becoming both a digital economy and a digital society by 2025, with technology at its core. One major component is the rise of the internet economy, where people use digital services to buy, sell, socialize and even manage their day-to-day lives.

The internet economy in Singapore, Malaysia, Indonesia, the Philippines, Vietnam and Thailand — the largest economies in the bloc — is predicted to cross $300 billion by 2025, according to a report last year.

There are three things to consider when thinking broadly about ASEAN’s digital transformation, according to Abdul Mutalib Yusof, Brunei’s minister of transport and info-communications, who was also on the same panel.

The three factors are: opportunities, technology neutrality, and the role of policymakers and regulators.

Policymakers and regulators have to come up with mechanisms and approaches that strike a balance between technology’s impact on the economy, on society, and on national security, Mutalib said.

He explained that technology, in and of itself, is the least important and challenging issue. “It’s those non-technological challenges or opportunities that I mentioned, those are the factors that we should actually come to think (about) together as ASEAN as a whole,” he added.

Brunei currently holds ASEAN’s rotating chairmanship.

Data flows and cybersecurity

Singapore’s communications minister pointed out that ASEAN’s digital masterplan already has a framework and model contractual clauses aimed at helping companies operating in the region to better manage data transfers from one country to another.

“This is one of the ways in which we are trying to facilitate cross-border data flows that will, in turn, help to grow digital trade,” Teo said.

Singapore’s Deputy Prime Minister Heng Swee Keat announced Tuesday a digital exchange that would allow multiple stakeholders — such as logistics players, shippers and buyers — to share valuable information like real-time cargo locations.

ASEAN has also implemented closer integration in terms of its cybersecurity cooperation, according to Teo. That includes establishing an information exchange mechanism where countries can share information on suspicious activities and potential cyber threats with one another.

In 2019, Singapore launched a new cybersecurity center where ASEAN members can work together to carry out research, share knowledge and train to respond to online threats.

“Instead of technology bifurcation, we are actually seeking to have more interoperable systems and standards,” Teo said. “We are thinking of how this can promote cross-border data flows and to grow digital trade that will help our companies, both large and small.”

“We see that there is great benefit in cooperation on cybersecurity as well as trusted digital transactions,” she added.