In a significant step towards enhancing digital economic cooperation, member states of the Association of Southeast Asian Nations (ASEAN) have announced their agreement to conclude negotiations on the Digital Economy Framework Agreement (DEFA) during the 27th meeting of the ASEAN Economic Council held in Cebu, Philippines.
According to the Indonesian Coordinating Minister for Economic Affairs, Airlangga Hartarto, member states are committed to completing all aspects of the negotiations by May 2026, with the aim of signing the agreement during the ASEAN summit in November of the same year.
Details of the Event
This move is part of ASEAN's efforts to boost the digital economy in the region, as Hartarto noted that the texts related to the agreement still require review, but must be finalized on time. He confirmed that all member states will periodically review the texts to keep pace with rapid developments in the digital economy.
After the signing of the agreement, it is expected that the ratification process by member states will take place within 180 days, reflecting the association's commitment to realizing the benefits of DEFA as quickly as possible.
Background & Context
DEFA is considered the world's first comprehensive framework for the digital economy, launched during Indonesia's presidency of the association in 2023. The agreement aims to enhance digital economic integration among member states, contributing to the region's position as a global digital hub.
Studies indicate that the implementation of DEFA could double the value of the digital economy of ASEAN countries from one trillion US dollars to two trillion US dollars by 2030, highlighting the importance of this agreement in achieving sustainable economic growth.
Impact & Consequences
The implications of DEFA include strengthening digital infrastructure, developing human skills in technology, transforming small and medium enterprises, and enhancing cybersecurity regulations. The agreement will also help attract investments in the high-tech sector, thereby enhancing the digital sovereignty of member states.
This move is expected to improve the business environment in the region, contributing to increased innovation and job opportunities, especially in light of the global shift towards a digital economy.
Regional Significance
Arab countries can benefit from ASEAN's experience in developing the digital economy, as they face similar challenges in enhancing digital innovation and expanding technology use. Cooperation between Arab nations and ASEAN countries in this field could contribute to achieving sustainable development.
In conclusion, the DEFA represents a strategic step towards enhancing digital economic cooperation among ASEAN member states, opening new horizons for growth and development in the region.