Report of the NEAT WG Meeting
Digital transformation as a new driver for socio-economic development
Hosted online by NEAT Vietnam
Tuesday, 7 June 2022
I. Overview
1. In the context of the Fourth Industrial Revolution, the world is beingtransformed by new technologies that change how the economy develops and how
people live. Digital transformation is accelerating at a much faster and broader
scale as a solution for countries to overcome the impact of COVID-19 and othercrises. Still, for those unprepared, the digital transformation poses significant risks,
especially for those at risk of being left behind.
2. Digital transformation plays a crucial role in economic recovery anddevelopment. In the post-Covid-19, the transformation of the digital economy has
gained pace around the world. As a result, international cooperation in the digital
economy is more urgent as countries are exploring ways to resume their economicactivities after the downturn over the last two years.
3. Although the need for cooperation is high, challenges remain in maximizing thebenefits of the digital economy. This includes: (i) Inadequate ICT-related legal
frameworks; (ii) Lack of digital infrastructure; (iii) Limited digital literacy; (iv)
The digital gap between urban and rural areas; (v) Inadequate transport
infrastructure and poor delivery system and so on.
4. This new context has required the ASEAN Plus Three (APT) countries toformulate joint agendas and frameworks to better develop the digital economy foreconomic development. In August 2018, the 50th ASEAN Economic Ministers
Meeting adopted the ASEAN Digital Integration Framework. It emphasizes that
digital integration is a crucial element, in line with the Master Plan on ASEAN
Connectivity 2025, to create a more inclusive ASEAN region and enable ASEAN
member states to compete more effectively in the global economy collectively andindividually.
5. Some agreements on the digital economy (DEAs) have been signed to create afree digital trade environment between two or more economies. Major modules inDEAs may include artificial intelligence, e-bill, e-payment, paperless transactions,1

protection of privacy data, trans-border data, and open government data. Theseissues are different in the e-commerce chapter of an FTA.
6. The Working Group aims to provide a platform for academics and scholars fromNEAT member countries to exchange their knowledge, experiences, and views on
the issue of digital transformation. This platform is also expected to be able tocreate a mutual learning forum that highlights the experiences of each APT country
to digitalize their economies and promote regional cooperation in the digitaleconomy. It also attempts to develop and propose a recommendation to establish abetter framework for regional cooperation under APT mechanisms for the digital
economy.
II. Lessons learned
7. While acknowledging the uniqueness of the status-quo in each APT country, theWG agreed that some best practices are proven to be significant in ensuring thesuccess of policies in digital transformation and regional cooperation to develop
the digital economy. In general, it is recognized that emerging technologies offer
great potential to drive economic recovery and development, as demonstrated by
the ongoing digital transformation that fosters the region's long-termcompetitiveness and improves the livelihoods of its people.
8. The WG also further stresses the importance of removing unneeded regulatory
barriers to the digital economy. An adequate harmonization and facilitation ofprocedural rules are critical to prevent the technology divide and fragmentation
among new countries. In addition, APT countries can share best practices in digitaltransformation and signing digital economic agreements.
9. The WG believes that the digitalization business environment and policy
framework is also a crucial factor that shapes the effectiveness of digitaltransformation in APT countries. Some APT countries faces challenges to realize
the full potential of their policies due to a lack of innovation in corporate cultureand business operation, particularly in SMEs.
10. Another lesson is the importance of digital connectivity, as there is a significant
difference in ICT infrastructure within the region. For the region, closing crosscountry gaps would be substantial for regional cooperation and the Master Plan on
ASEAN Connectivity 2025.

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11. The WG acknowledges that people are at the center of this transformation.
Through digital transformation, the government better serves the citizens, whilebusinesses provide better products and services to their customers. In addition,
ordinary citizens can have a more convenient life by using digital technology intheir daily life. Meanwhile, there is a problem with the unemployment rate as somejobs will be displaced by digital transformation.
12. The WG believes that the private sector is essential to digital transformation
and regional cooperation in the digital economy. In some circumstances, theregulatory framework can sometimes not catch up the technology development as
the digital economy develops immensely. Therefore, close coordination between
government agencies and technology companies is vital to provide necessary input
for the government to ensure that the regulation related to the digital economy isupdated.
III. Recommendations
13. The APT governments need to work closely together. The following are key
recommendations to promote APT cooperation in establishing a better framework
for regional cooperation in the digital economy and fostering APT’s economic
recovery:1) Strengthen the solidarity among APT countries and demonstrate political will
and commitment to a more robust regional cooperation in the digital economy.
2) Strengthen cooperation and sharing of information, providing technicalexpertise in training and promoting dialogue on how to set up relevant policies on
digital transformation and signing digital economic agreements, which can ensure
the compatibility among different technology systems to prevent the technology
divide and fragmentation.
3) Improve both the business environment and policy framework for digitalizationand digital transformation, which would require holistic changes in corporate
culture and business operations, mainly targeted at SMEs.
4) Develop policies for the digital transformation of APT member countries. This
includes:a. Invest in disruptive R&D programs.
b. Create digital talents and appropriate IT infrastructures.
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c. Develop the startup ecosystem.
d. Provide support and guidelines to encourage the private sector to adopt
cutting-edge technologies.
e. Digitalize government services to create robust and effective egovernment.
f. Enable firms (particularly SMEs) to participate in international trade (viacross-border e-commerce) through international agreements.
g. Invest in digital (soft) and hard infrastructure development.
5) Develop policy measures to ensure this transformation will not damage ourachievement of poverty reduction. This includes:a. Unemployment compensation.
b. Re-skilling and re-tooling of people to guide them to a digital society.
6) Strengthen science and technology cooperation and transfers on technologies
proven essential in dealing with pandemics, such as AI, robotics and drones, anddigital and mobile technologies.
7) Promote the development of regional digital economic agreements (DEA), sothat countries within the region can cooperate better to: enable trusted cross-borderdata flows and facilitate the regional development of new products and services bypromoting data-driven innovation across borders; build regional standard and trust
among cross-border digital systems and facilitate the development of inclusiveparticipations in the digital economy.

4Annex
List of Participants of the NEAT WG Meeting

Digital transformation as a new driver for socio-economic development
Tuesday 7 June, 2022

13:3014:00
14:0014:10
14:1014:15
14:1514:20

Registration and Technical Preparation

14:2015:20

Session 1: Sharing Insights and Experiences

Introduction of ParticipantGroup photo
Welcome and Opening Remarks
Associate Professor Nguyen Anh Tuan, Deputy Director-General of the Institute ofForeign Policy and Strategic Studies, DAV
Speakers
NEAT- Brunei (TBC)
NEAT- Cambodia (TBC)
NEAT-China

Prof. Andy Lee, Professor and Executive Deputy-Dean, the Institute of Regulatory Sciencefor Medical Devices at Sichuan University.
Topic: The strategy and roadmap of regional digital economic collaboration

NEAT- Laos

Mr. Somphay Vongmahachack, Director of Human Resource Development Division,
Institute of Foreign Affairs
Topic: Digitalization Enhances Lao Socio-Economic Development

NEAT-Malaysia
15:2015:50
15:5016:00
16:0017:20

Dr. Patrick Soh Chin Hooi, Head of Department, IT Management Unit
Faculty of Management, Multimedia University, Cyberjaya

Discussion
Break

Sharing Insights and Experiences
Speakers
NEAT-Indonesia

Dr. Fithra Faisal Hastiadi, The Executive Director of Next Policy, a national research thinktank based in Depok.
Topic: Post Covid recovery: harnessing digital platforms

NEAT-Japan

Prof. KAWAI Masahiro, Councilor and Distinguished Research Fellow, JFIR andRepresentative Director, Economic Research Institute for Northeast Asia (ERINA)

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NEAT-Singapore

Dr. Li Yao, Research Fellow, East Asian Institute, National University of Singapore
Topic: Promoting the Digital Economy Through DEAs

NEAT-Vietnam
17:2017:50
17:5017:55

Dr. Le Trung Kien, Assistant Director-General, Director of Center for Security andDevelopment Studies, Institute for Foreign Policy and Strategic Studies, DAVDiscussion

Wrap Up and Closing Remarks
Associate Professor Nguyen Anh Tuan, Deputy Director-General of the Institute ofForeign Policy and Strategic Studies, DAV6