Digitalization, or using digital-enabled tools and digital technologies, is revolutionizing how enterprises offer propositions and interact with their clients.
The digital shift has triggered a global mindset shift with a wider impact and less predictable business models.
Digital tools have made the world more innovative, efficient, and connected. The Covid-19 pandemic, which has upended our daily lives and almost permanently disrupted how we conduct our socio-economic activities, has intensified the acceleration of the adoption of the digital lifestyle.
Indeed, digitalization is disrupting the global economy, recreating the consumer landscape that is a boon to many developing nations. For many in the Asian region, digital technology has been their most significant engine of growth over the past years.
According to a report by Google, Temasek, and Bain & Company, Southeast Asia’s digital economy is on track to grow 20 percent to nearly $200 billion in gross merchandise value by the end of 2022, three years earlier than expected.
SEA’s digital economy is expected to grow twice as fast as GDP in most Southeast Asian countries and could reach up to $1T by 2030 if the full potential can be unlocked. Fundamentals of the digital economy remain solid, and there’s substantial headroom for growth in developing sectors and unpenetrated markets.
“Southeast Asia’s digital decade continues to provide opportunities for people, businesses, and communities to grow, and there are boundless opportunities ahead. While increasing profitability and maintaining growth momentum in the next 2-3 years has become a priority for companies across the region, ensuring the digital economy scales in an environmentally and socially sustainable way is just as important. Addressing ESG concerns and doubling down on our collective efforts to improve digital and financial inclusion will be a key to unlocking the full potential of Southeast Asia’s 1 trillion digital economies by 2030,” said Stephanie Davis, vice president of Google Southeast Asia.
But Asia has embraced digital transformation, which began even before digitalization became a buzzword.
A critical goal of the Asia-Pacific Economic Cooperation had been to make sure that the member economies comprising the group can fully participate productively in the region’s growing economy.
Towards this end, APEC established in 2004 the APEC Digital Opportunity Center to provide computer skills training to vulnerable rural and urban communities within the region.
With over a hundred centers in 10 APEC economies offering information technology (IT) training, the ADOC is focused on transforming digital divides into digital opportunities.
Over the years, these Centers have trained over 500,000 people – almost half of them women – throughout the APEC region. Many who have received digital training from ADOC have found employment or have started their own businesses, improving livelihoods and income for their families.
Not bad for an organization that’s often mistaken for being just a mere laidback “social club.”
Still, for all it has accomplished, APEC must continue to strive harder to fully realize its objectives, particularly as it emerges into a world upended by the Covid-19 pandemic.
The APEC region is expected to grow moderately by 2.6 percent in 2023, reflecting sharp downgrades in economic growth for all member economies and the rest of the world.
Reeling from a pandemic marked with virus mutations, the world is now struggling with soaring inflation, a protracted war in Ukraine and heightened uncertainties.
Growth slowdown is apparent in 2022 when economic and trade activity in APEC grew at a slower pace.
Various difficulties faced by APEC and the world beyond the region emphasize the importance of preparedness, that is, preparing for the next pandemic or crisis and preparing for a future that is inevitably highly digitized and very much exposed to the negative impacts of climate change.
Taking those into consideration, there is an urgent need to work more cohesively towards a sustainability and inclusivity agenda designed to future-proof the economies in the APEC region.
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