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  • Writer's pictureBait Al-Amanah

Digital Economy for Driving SDG Progress in ASEAN

By Haniss Haidi, Research and Advocacy Analyst at Bait Al Amanah and Mohammad Zulhafiy Zol Bahari, Marketing and Communication Manager at ASEAN Youth Organization (AYO) Malaysia

Digital technology has become an indispensable tool in addressing the complex societal issues with the emerging progress of the 4th Industrial Revolution (4IR). From poverty and climate change to gender inequality and injustice, these pressing issues require innovative solutions that can be facilitated through the use of technology. The implementation of the United Nations' Sustainable Development Goals (SDG) is one such area where digital technology plays a crucial role.

Recognising this, the ASEAN Foundation, in collaboration with Fakultas Hukum Universitas Indonesia and Microsoft Indonesia had organised a Policy Dialogue on Digital for Development in the ASEAN and Global South last May. The event focused on unlocking the potential of technology for sustainable growth and inclusion. Haniss Haidi (Research & Advocacy Analyst) and Mohammad Zulhafiy Zol Bahari from AYO Malaysia were invited to join the public dialogue and had the opportunity to engage with other esteemed academics and young professionals from the ASEAN region. The policy dialogue emphasised the significant role of digital technology in tackling complex challenges across ASEAN and Global South such as poverty, climate change, gender inequality, and injustice.

Microsoft, a global leader in the technology industry, has acknowledged the potential of digital technology in advancing the SDGs by empowering every individual and organisation to achieve more through the creation of technology that brings benefits to society. This aims to contribute to the advancement of all 17 SDGs by leveraging its creativity, expertise, and know-how.

ASEAN has made substantial progress in accessing advanced technology, placing it on par with other major countries such as the US and China. ASEAN’s digital economy, encompassing e-commerce, travel and the media sector, is projected to achieve a value of US$200 billion by the year 2025.

This presents ASEAN with an exciting opportunity to enhance its economy beyond conventional sectors of investments. The emergence of this global mega trend, which indicates a tech-driven future, drives promising digital advancement for ASEAN to bolster its economic performance and promote people’s prosperity within the region.

However, the level of internet penetration across ASEAN countries demonstrates substantial variation, posing challenges to digital transformation. While the overall rate of internet users in ASEAN surpasses the global average of 50% with a 58.6% rate, significant digital disparities exist among member countries.

Lao PDR records the lowest access at a mere 25.5%, while Brunei Darussalam boasts the highest percentage at an impressive 94.9%. There is a stark digital divide across and within borders, leading to a lasting impact on inequality among individuals, social groupings and countries.

Innovation and Technology-driven Progress towards SDG

Artificial intelligence (AI) has emerged as a powerful tool in driving progress towards the SDGs. It has the potential to revolutionise various sectors, including healthcare, agriculture, education, and environmental conservation. Japan serves as an exemplary case study, showcasing the successful utilisation of AI in achieving specific SDGs. The application of AI in these sectors enables more efficient processes, improved decision-making, and the identification of innovative solutions.

ICT innovation plays an important role in fostering ASEAN development. Indonesia for instance, aiming to be among the top global economies by 2045, faces significant challenges in breaking through and achieving its vision.

Malaysia has set its sights on becoming a leading digital economy by 2030. However, there are challenges that need to be addressed, such as the lack of integrated data on digitalisation companies and the need for increased public participation as key contributors to SDG implementation and bridge the gaps as well as to ensure inclusive growth.

Indonesia, on the other hand, has made significant strides in integrating the SDGs into its National Action Plan through a responsible ministry called the Ministry of National Development Planning (BAPPENAS) that oversees policy and strategy implementation at the national level, by formulating and evaluating development plans, ensuring alignment with long-term goals.

The government must take proactive measures to enhance digital literacy and promote the development of digital skills among the population. Initiatives such as Pandu Digital, demonstrated by the Indonesian government can help provide the public with the necessary skills to thrive in a digitalised world.

Building a Resilient Digital Ecosystem in ASEAN

Taking the next steps, embracing digital readiness is crucial to foster inclusive prosperity among nations in ASEAN. By harnessing the potential of digital technologies, member countries are able to enhance their ability to drive innovative solutions and strengthen the digital ecosystem within the region. Essential investments in cross-border digital infrastructure projects must be prioritised to facilitate a seamless flow of data across borders.

Malaysia is leveraging government support to capitalise on the swiftly changing digital landscape and transform into a regional powerhouse. The establishment of the Digital Investment Office facilitates increased investments in the digital economy sector. Notably, Bridging Data Centres' expansion into Johor, Malaysia, as a cutting-edge sustainable data center MY06, further drives cross-border digital growth with its robust infrastructure and widespread internet coverage.

Facilitating the cross-border mobility of skilled individuals within ASEAN can foster a dynamic environment that encourages knowledge exchange and shared expertise, forging a path towards prosperity, and a brighter digital future for all its member countries.

Strengthening partnerships among ASEAN countries and the Global South is also crucial for effective SDG implementation, especially to enhance company's efforts to support digitalisation in achieving the SDGs.

Microsoft's initiatives for instance, include supporting humanitarian action to build stronger communities, using technology to prepare for and respond to crises, powering access for marginalised communities, and applying technology to catalyse action on human rights. Microsoft's commitment to sustainability and clean energy also aligns with the SDGs.

Analog policies that do not align with digital outcomes need to be updated. Additionally, there is a need for local talent development and skilling agendas that are specific to the region. Empowering youth, who possess innovative thinking and predictive technologies like AI, is crucial for driving change and scaling up strategies.

Inclusive and sustainable development requires equitable access to well-developed infrastructure for vulnerable groups, including indigenous and rural communities. Malaysia, for example, still faces significant disparity gaps between different regions. Looking to Indonesia as a case study, people-centric policies that promote shared development and public participation can provide valuable lessons for other countries.

Digital technology offers immense potential in driving progress towards the SDGs. It is high time to enhance collaboration between governments, private sector, and civil society that will be instrumental in harnessing the transformative power of digital technology to create a better future for everyone.

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