The digital revolution that has become such a powerful force for global change is still in early days in the ASEAN member states. ASEAN’s digital economy represents only 7% of its GDP, compared with 16% in China and 35% in the US, Bain said in a report on Monday. However, the region has much to gain by laying the foundation for the digital economy to power and accelerate intraregional trade and growth (what we term “digital integration”). Digital integration will be critical for ASEAN businesses to compete at home and overseas—it has the power to turn small and midsize enterprises (SMEs) into regional and global players. Digital integration could deliver a $1 trillion rise in GDP in ASEAN by 2025.
Getting there will take a significant effort. While enhancements have been made across ASEAN, broadband coverage needs to improve in rural areas, and advanced digital tools need to become more affordable for SMEs, among other challenges. Also, to help individuals and businesses across the region benefit from digital opportunities, member states will need to accelerate and coordinate their initiatives. The results can be dramatic: ASEAN businesses would have the opportunity to leapfrog those in other major economies.