The first day of the Digital Economy Forum II held in Siem Reap had core themes of ‘Advancing Asia’s Digital Economy: Digital Policy Support’ for MSMEs, and ‘The Evolving Digital Policy Landscape’.
Digital Economy Framework Agreement (DEFA)
Dr. Bradly Jensen Murg, Provost at Paragon University, Senior Advisor, and Distinguished Senior Research Fellow at the Cambodian Institute for Cooperation and Peace (CICP), delivered a presentation on the ASEAN Digital Integration Framework, shedding light on the recently ASEAN-approved Digital Economy Framework Agreement (DEFA), which emerged as a prominent topic during the event.
In an interview with B2B Cambodia, Dr. Murg emphasised that the DEFA framework is set to progress towards negotiation by the end of 2024, with an anticipated implementation timeline by 2025. He expressed his fascination with the rapid pace at which developments have been unfolding, noting a considerable acceleration compared to the initial plan. Dr. Murg highlighted that the DEFA represents more than a conventional trade agreement. It encompasses the crucial aspects of system interoperability and cybersecurity. He regarded the deeper digital integration throughout the region as a significant stride forward, benefitting not only Cambodia but the entire ASEAN community. He also acknowledged that alongside the implementation of the framework, it is crucial to assess the varying levels of digitalisation and the capacity to progress, and he identified data-related concerns as the most pressing issue.
"In the near term, my biggest concern (revolves around) questions of data, data protectionism, and just generally increasing protectionist moves by governments. That could be a very significant hurdle to overcome in the negotiations next year if this is going to take effect,” he cautioned.
How Can Businesses Leverage The Digital Economy Framework Agreement (DEFA)?
Dr. Murg said that this is the sort of agreement that will have to come not just from the top down but from the bottom up and that as the negotiation of DEFA progresses, it is vital for the private sector throughout ASEAN to express their needs to the government, he said. He added that a key factor in achieving a successful and workable agreement is the active involvement of the private sector and digital industry players and that all parties should share their concerns, interests, and insights regarding the future, including aspects such as security and interoperable transactions. "With DEFA, the expectation is USD $2 trillion in the digital economy - I mean, it is simply massive growth. So there's a lot on the table for all of us throughout the entire region," he added.
Digital Policies to Support E-Commerce And Cross-Border Trade
In an interview with B2B Cambodia, Mr. Jay Cohen, Partner and Director at Tilleke & Gibbins Cambodia, delivered a presentation on Digital Policies to Support E-Commerce And Cross-Border Trade at the Digital Economy Forum II, emphasised the crucial connection between the digital and non-digital spheres, particularly when it comes to cross-border trade and the necessary customs procedures involved in moving packages between countries.
With regard to e-commerce and cross-border trade, Mr. Cohen said logistics would still be a challenge for Cambodia when moving lots of packages across the border, as well as in terms of regulatory clarity and applying for licences - improving this would facilitate people's participation in the digital economy he concluded. Regarding consumer protection, Mr. Cohen said that it is getting quite difficult for the government to control when the advertisements are online and that it needs more consumer protection rules as well as consumer protection organisations. “Otherwise, it's very hard; you know, a lot of consumers are purchasing goods and services, it's relatively small value, so it'd be really impossible to go to court,” he said.
Mr. Cohen expressed support for initiatives that aim to harmonise rules, regulations, and standards governing e-commerce and cross-border trade. He believes that when countries have common rules, it becomes easier to conduct business and facilitate transactions across borders. Additionally, he mentioned the importance of aligning countries' positions on taxation and determining what constitutes a permanent establishment. Harmonising these aspects can further facilitate business operations. Mr. Cohen acknowledged that countries may vary in terms of their levels of development but highlighted the significance of collaborative efforts, such as the DEFA, to implement common standards and positions. He believes that such initiatives support the entire e-commerce ecosystem by fostering a conducive environment for businesses to thrive.
Policy Advocacy Experience in Enabling Stakeholders
Mr. Ryan Patrick Garcia-Evangelista, Country Director of the Center for International Private Enterprise (CIPE) in the Philippines, presented on Policy Advocacy Experience in Enabling Stakeholders learning from the successful experience of CIPE.
CIPE is a nonprofit organisation affiliated with the US Chamber of Commerce and works closely with the private sector to support their advocacy for free enterprise and market-oriented reform, Mr. Garcia told B2B Cambodia. Besides businesses, CIPE also works with civil society organisations to enable their capacity to implement effective programming that would help support enterprise development and advocacy for policy reforms. In the Philippines, CIPE also worked with private enterprises, associations, and the Philippine government to roll out the CIPE program as part of the government courses specifically for micro, small, and medium enterprises (MSMEs) so that they can access it more publicly.
What Are The Challenges To Gathering Stakeholders?
When it comes to gathering stakeholders, Mr. Garcia highlighted the challenges that arise from attempting to unify diverse groups with different interests and priorities, particularly within business associations. To address this, he emphasised the importance of understanding the needs of stakeholders. From his experience with CIPE in the Philippines, to effectively mobilise stakeholders, they:
- Firstly focused on creating awareness and fostering a sense of unity among stakeholders regarding their shared interests and priorities.
- Secondly, he emphasised the significance of committed leadership within both institutions and individuals who are dedicated to supporting the growth and active involvement of their members and stakeholders.
- Proactive engagement was the third factor and he said this involved extensive consultation with stakeholders across different geographic and demographic segments. Through this consultation process, valuable feedback was generated, which was then used to align strategies that enabled constructive collaboration with the government and influence positive change.
Digital Policy Support For MSMEs In Cambodia
Mr. Siriwat Chhem, Director, Centre for Inclusive Digital Economy, Asian Vision Institute (AVI), presented about the digital policy support for MSMEs in Cambodia and said that the vision of the Cambodian government is to have an upper-middle-income country by 2030, and a high-income country by 2050. He said that there have been many strategies and initiatives put into place over the last few years to achieve this and one of the most popular initiatives has been the Cambodia Digital Economy and Society Policy Framework. Siriwat added that there is an increasing online presence in Cambodia and that the urban population is growing. The Cambodian government’s online business registration platform (CamDX) has also become an increasingly popular tool for registering businesses in Cambodia. He affirmed that there has been increasing computer access in higher education, which has reached 28% nationally, and 30% of the population has basic digital skills. The Ministry of Education has produced over 6,000 e-learning videos in support of education and there are women's entrepreneurship programs which utilise existing digital applications and online platforms.
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