The ASEAN Digital Economy Framework Agreement: A Groundbreaking Milestone

The launch of the negotiations on the ASEAN Digital Economy Framework Agreement (DEFA) marks a significant achievement for Indonesia’s ASEAN chairmanship. As the world’s first regional digital economy agreement, the DEFA has the potential to enhance and safeguard a digital trade ecosystem, projecting a doubling of the regional digital economy’s value to US$2 trillion 2030.

The Framework for Negotiating DEFA outlines the provisions and processes that will be covered, including digital trade, cross-border e-commerce, cybersecurity, digital identities, digital payments, cross-border data flows, and other emerging topics such as AI governance and ethics.

Thailand will chair the ASEAN DEFA Negotiating Committee (NC) with participation from all ten ASEAN member states (AMS). The negotiation process is expected to conclude within two years, with the first NC meeting set to take place the end of this year. However, given the complexity of multilateral negotiations involving ten parties, the timeline could be challenging to meet.

Several factors will influence the negotiation duration, including the similarities in existing regulations among negotiating countries, the number of provisions included, any red lines set parties, and the level of ambition of the agreement.

To ensure the success of the DEFA, capacity-building initiatives and a phasing-in period for compliance will be indispensable, considering the disparity in digital readiness among AMS. Boosting the digital capabilities of countries lagging behind and bridging technical and regulatory gaps are integral components of the negotiations.

Despite the challenges, the progress made on the DEFA two years ahead of schedule is a positive sign. The AMS have shown a strong commitment to the vision of an integrated regional digital ecosystem. Noteworthy initiatives such as the ASEAN Cybersecurity Cooperation Strategy and the proposed ASEAN Guide on AI Governance and Ethics will facilitate key provisions of the DEFA.

With the momentum and commitment already demonstrated, the DEFA’s realization is within reach. This groundbreaking achievement would shape the future of the ASEAN digital economy and foster greater competitiveness in digital trade activities.

Defintions:
– ASEAN: Association of Southeast Asian Nations
– DEFA: Digital Economy Framework Agreement
– AMS: ASEAN member states
– AI: Artificial Intelligence

Sources:
– The original source article (source not provided)