ASEAN countries sign region's first digital economy pact, laying foundation for collaboration

MANILA: Association of Southeast Asian Nations (ASEAN) member states on Saturday (Nov 14) signed the bloc's first region-wide, legally binding Digital Economy Framework Agreement (DEFA), with Deputy Prime Minister Gan Kim Yong describing the pact as reflecting the diverse state of readiness among member countries.

Noting that it has taken the bloc “several years” to negotiate the deal, Mr Gan said: “To be able to negotiate an agreement that is on one hand sufficiently ambitious and at the same time acceptable to all member countries, is not easy.”

The DEFA is ASEAN’s first standalone digital economy agreement, said the Ministry of Energy, Trade and Industry (METI) in a press release.

The deal lays the foundation for closer digital economic integration and opens up opportunities for businesses in ASEAN's growing digital market, said the ministry.

The agreement covers cross-border data flows, end-to-end digital trade, protection of source code, cybersecurity and artificial intelligence.

It aims to promote greater interoperability across digitally enabled sectors, such as technology, e-commerce, payments, logistics and supply chains, letting businesses of all sizes expand and scale across the ASEAN region.

COLLABORATION AMID FLEXIBILITY

Mr Gan, who is also Minister for Energy, Trade and Industry (Trade), said DEFA provides ASEAN with a basic framework for digital rules, including cross-border data flows.

“But each country has its own specific concerns. Some may relate to privacy laws, some may relate to business confidentiality, some may relate to national security,” he said.

“So there are exceptions that will be allowed under this framework agreement. But what is important is that it sets out the basic cross-border data flow rules to allow data to be able to be transferable, subject to some of these reservations and concerns.”

Mr Gan said that DEFA is designed to be flexible and evolve with time, so that the bloc is not restricted to progressing at the pace of its slowest member.

“The important thing is we keep the door open for other countries who are not quite ready today, to be able to join in any time when they are ready, he said.

“I think this is inclusive, but yet at the same time allows us to progress at a much faster pace.”