ASEAN announced the ASEAN Digital Economy Framework Agreement (DEFA) in September 2023,[1] launching it during the 10th ASEAN Economic Community (AEC) dialogue at the end of Nov 2023.[2] The DEFA is the world’s first regional digital economy pact and is expected to unlock the value of ASEAN’s digital economy, which is projected to triple through the adoption of digital technologies from approximately USD 300 billion to almost USD 1 trillion by 2030.[3] Progressive rules in DEFA would double this value contribution, unlocking USD 2 trillion for ASEAN’s digital economy.
Following a series of stakeholder consultation workshops and feedback sessions with the private sector, including small and medium enterprises (MSMEs) and large corporations,[4] the DEFA seeks to offer a comprehensive roadmap to empower businesses and stakeholders across ASEAN through the nine key modules listed in its Framework for Negotiating ASEAN Digital Economy Framework Agreement:[5]
- Digital trade
- Cross-border e-commerce
- Payments and e-invoicing
- Digital ID and authentication
- Online safety and cybersecurity
- Cross-border data flows and data protection
- Competition policy
- Cooperation on emerging topics
- Talent mobility and cooperation
Access Partnership is tracking developments in the DEFA, as well as other digital economy and digital trade agreements, closely (see table below). We applaud ASEAN for taking this step forward in laying the groundwork for a strong future digital economy.
Moving into 2024, we anticipate that negotiations for developing the DEFA will progress quickly. With this in mind, we note that there are some considerations to keep front of mind during the DEFA’s next negotiation stage:
- Private sector engagement: It is important to keep the private sector actively involved in the crafting of the DEFA to ensure that it remains relevant, value-focused, and inclusive. While the initial recommendations were developed through extensive engagements with MSMEs in ASEAN,[6] these engagements should be maintained consistently and iteratively to avoid rapid redundancy.
- Digital skills development of ASEAN’s workforce: To transition from consumers of technology to producers of technology, there is a critical need to develop digital talent that is ready to participate in and harness these forms of technology for the digital economy.
- Consistency with global standards and other trade agreements: The DEFA must reinforce and strengthen baselines, both between ASEAN Member States (AMS) and across other digital economy agreements, to minimise conflicting networks of agreements and enhance global digital trade standards. Leveraging international standards, such as United Nations Commission on International Trade Law (UNCITRAL) laws and APEC Cross-Border Privacy Rules (CBPR), could facilitate this process.
If you would like to request an expert briefing on digital trade agreements or have information to add to our list of Digital Economy Agreements/Digital Trade Agreements table below, please contact Kew Yu Jing at [email protected], or Lim May-Ann at [email protected].
List of Digital Economy Agreements/Digital Trade Agreements (as 13 Dec 2023)
| Economies/Name of Agreement | Links | |
|---|---|---|
| ASEAN Digital Economy Framework Agreement: negotiation framework endorsed by leaders in Sep 2023, DEFA not drafted/finalised yet. | ASEC – DEFA Negotiation Framework 2023 | |
| Iceland, Liechtenstein, Norway and Switzerland – the European Free Trade Association (EFTA) – Singapore: possible Digital Economy Trade Pact/in discussion Feb 2023 | ||
| EU-Singapore Digital Partnership (EUSDP): signed 1 Feb 2023 | SG MTI EU | |
| Korea-Singapore Digital Partnership Agreement (KSDPA): effective 14 Jan 2023 | SG MTI KR MOTIE | |
| Digital Economy Partnership Agreement (DEPA) – Singapore, Chile, New Zealand – with Korea announcing its intention to join DEPA in Sep 2021: effective 12 Jun 2020 | SG MTI NZ MFAT CL SUBREI | |
| United Kingdom-Singapore Digital Economy Agreement (UKSDEA): effective 14 Jun 2022 | SG MTI UK DIT | |
| Singapore-Australia Digital Economy Agreement (SADEA): effective 8 Dec 2020 | SG MTI AU DFAT | |
| United Kingdom-Ukraine Digital Trade Agreement (DTA): effective 30 Nov 2022. Part of an add-on to the existing UK-Ukraine Free Trade Agreement: effective 9 Nov 2020 | UK DIT UA MEDT |
Source: Access Partnership, 2023
[1] https://www.straitstimes.com/asia/se-asia/asean-launches-talks-on-27-trillion-digital-economy-pact-to-drive-more-seamless-trade
[2] https://asean.org/10th-asean-economic-community-dialogue-unpacks-worlds-first-regionwide-framework-agreement-on-digital-economy/
[3] https://www.straitstimes.com/asia/se-asia/asean-countries-to-begin-talks-on-27-trillion-digital-economy-pact-by-end-2023
[4] https://asean.org/asean-defa-study-projects-digital-economy-leap-to-us2tn-by-2030/
[5] https://asean.org/wp-content/uploads/2023/09/Framework-for-Negotiating-DEFA_ENDORSED_23rd-AECC-for-uploading.pdf
[6] https://asean.org/wp-content/uploads/2023/10/ASEAN-Digital-Economy-Framework-Agreement-Public-Summary_Final-published-version-1.pdf
