INTRODUCTION Hi-tech deal will lead to closer integration and greater competitiveness
Asean plugs into a new era

Members of the Association of South East Asian Nations are making a collective bid for their share of the
global economy by entering the world of e-commerce. Launched with a framework agreement last November, the e-Asean initiative is aimed at reinvigorating the 34-year-old association and giving its members a new edge of economic competitiveness in a fast-changing world.
Asean, comprising Brunei, the Philippines, Malaysia, Singapore, Thailand, Indonesia, Cambodia, Myanmar (Burma), Vietnam and Laos, is potentially one of the world’s most powerful economic groups, but its member states have been struggling along the path of economic recovery since the 1997-98 financial crisis hit the South East Asian economies.

Rodolfo Severino Jr, Asean secretary general, wants to see greater integration and freer movement of people and goods

The e-Asean initiative commits the countries to a future that rests on closer integration, high technology and regional free trade. The agreement is targeted to achieve a seamless environment for e-commerce, a common marketplace for hi-tech goods and services, connectivity, local content, human resource development and e-governance. Asean general secretary, Rodolfo Severino, says economies based on information and communications technology (ICT) will speed up the implementation of free trade and regional harmonisation.

“I would like to see greater integration of Asean, not just economically or in terms of the market, but much freer movement of people and goods,” he says. “This is not only a matter of removing obstacles, but having greater harmonisation of products and standards.”
Investment in ICT will particularly assist Asean’s less-developed members, such as Laos and Cambodia. “A lot of this has to be accomplished by the individual efforts of the countries themselves,” adds Mr Severino. “But ICT is an area where we can help newer members acquire the capacity to develop and use technology to accelerate their development.”
The emergence of new leaders in several Asean countries in recent months is setting a new tone for inter-governmental cooperation, which promises a return of investor confidence in the region.

Goh Chok Tong, prime minister of Singapore, says the Asean countries must press ahead with regional cooperation and integration in order to successfully meet the challenges of globalisation. “Unless Asean countries face the challenges together, we risk being marginalised in the new economic environment,” he adds.
The Asean member states account for just 1.5 per cent of the world’s gross domestic product (GDP), a fraction of the global economy. But with a market of half a billion people – and with the Japanese and Chinese markets within easy reach – there are considerable opportunities for export growth. Indeed, China has proposed to turn China and South East Asia in to one huge free trade zone.
The implementation of the Asean Free Trade Area (AFTA) will be brought forward from 2005 to 2002, with the exception of a few products. Some member countries, such as Malaysia, have already included much of their produce in the Common Effective Preferential Tariff (CEPT) scheme.

To foster the growth of e-commerce, Asean governments are working to create a favourable legal and regulatory environment to kickstart online business. This includes the mutual recognition of digital signatures, secure electronic transactions, payments and settlements, protection of intellectual property rights, personal data protection and consumer privacy.
Eighteen pilot projects have been started by the e-Asean task force, which comprises both public and private sector representatives. These include an e-entrepreneurship training programme, which aims to narrow the technology gap between Asean and technologically advanced countries, and an incubator network to provide companies with networking opportunities with venture capitalists and technopreneurs.

When Asean telecommunications ministers held their first meeting this summer in Kuala Lumpur, they stressed the need to provide efficient yet affordable access to information, including the internet.
They called for “cooperation and collaboration for a more wired and more interconnected Asean to draw a fair share of global investments and boost sustainable growth for the region”.
An agreement to formalise regional cooperation in the telecommunications industry was signed, creating working groups to collaborate on infrastructure, universal access, trade and investment, capacity building and the internet. The infrastructure for a regional internet exchange is expected to be ready within a year.

Mr Severino says governments must open up their telecommunications sectors to competition in order to reduce costs. “Many countries, including some in the Asean, have found to their people’s delight how much telecommunication costs have come down and services improved
A task force is exploring ways to develop a regional e-community
by ending monopolies and letting in competition,” he says.
When it comes to introducing ICT to remote areas, wireless connectivity could be the answer, as fixed-line telephony could prove too expensive and uneconomic where populations are sparse. “Asean governments might consider dedicating common radio frequencies for intra-Asean communications. This would bring down equipment costs and thus consumer charges,” says Mr Severino.

Both Brunei and the Philippines were founding members of Asean. Brunei, a tiny oil-rich nation on the island of Borneo, realises the need to diversify its economy and sees a future as a regional technology hub.
Abdul Rahman Haji Ibrahim, permanent secretary at the ministry of industry and primary resources, says technology will play a key role in the development of member states. “Realising that each Asean country has diverse and different levels of economic development, we need to breach the gap,” he says.
“There is quite a visible divide within the association because countries such as Cambodia, Laos, Vietnam and Myanmar are different from the original six Asean states in terms of development. Some are far behind, so that is why we need more time, more help and more technical systems for them.”

In the Philippines, ICT is one of the government's priority investment areas, and attractive tax and other incentives are offered by the Philippines Economic Zone Authority.
The new president of the Philippines, Gloria Macapagal Arroyo heads the Philippine Information Technology e-Commerce Council. She says: “I hope that by the time the Asean summit is held in November there will be
more e-Asean endorsed pilot projects. In particular I would like to see more pilot projects in the field of infrastructure development and e-government.”

She stresses that the success of the e-Asean initiative to date has been due largely to the strength of public-private partnerships.
“The task force has succeeded because it became a mechanism that allowed the private and public sectors to bring their respective comparative advantages together in preparing for the future,” she says. “This, in turn, guaranteed that our e-Asean initiative would be responsive to the real world demands and not what policy makers or academicians believe the market needs.”