Will APAC dominate the digital economy?
The pace of technological change across Asia-Pacific (APAC) is causing an abundance of opportunities and challenges in equal measure. For example, in Australia and New Zealand, there are 3 million unfilled cyber security roles and around four jobs for every qualified candidate. As a result, many businesses are taking six months to recruit, and contract rates are reaching up to $2,000 per day.
There is a similar story with the exponential demand for cloud-based specialists compared to the available talent and skills in the market. All of which has been made more difficult with the international border closures as a result of COVID-19. But as the world begins to open back up again, it's clear that big changes are happening.
In Bali, 80% of its economy has traditionally been generated by tourism. But when foreign tourists were prevented from entering, locals began exploring the world of NFTs and cryptocurrencies. Fast forward two years and an incredible 7.4 million Indonesians now own crypto, an increase of 85% since 2020. As a result, Tokocrypto is building an offline community hub in Bali, which will jump on the crypto tourism trend, enabling tourists to learn about crypto while on holiday. But this is just the beginning.
The Regional Comprehensive Economic Partnership (RCEP)
Earlier this year, the Regional Comprehensive Economic Partnership (RCEP) became the world's largest trade deal, and the US was not a part of it. The agreement between 15 countries will account for around 30% of the world's population (2.2 billion people) and 30% of global GDP. Many analysts believe that this could help APAC dominate the digital economy in the years ahead.
RCEP is also the first free trade agreement to unite China, Japan, and South Korea. Many nations will predictably watch from the sidelines to see how this relationship plays out. Elsewhere, Southeast Asia is experiencing an economic transformation driven by fintech. By bringing the Association of Southeast Asian Nations (ASEAN) into RCEP, it appears the region has its sights set on securing an early digital economy dominance.
Many believe that RCEP will play a pivotal role in dramatically increasing cross-border e-commerce activities. A report by Deloitte predicts that it will also pave the way for the region to enter a golden age for digital trade over the next three years. In addition, the Brooking
Institution believes RCEP will kickstart the world economy by adding $209 billion annually to global incomes.
Last year's edition of the economy SEA Report by Google, Temasek, and Bain revealed that Southeast Asia (SEA) alone could become a US$1 trillion digital economy by 2030. All of which suggests that the growth in the region could go on to define the future of technology worldwide. But it's essential to remember that trends around the building of a digital economy are following a universal theme.
Understanding the challenges of the digital economy
The arrival of a global pandemic highlighted several issues with countries adopting digital-first strategies that were not quite ready for them. For example, digital vaccination certificates or passports are difficult to enforce in areas of the Asia-Pacific where 40% of the population cannot access the Internet and one-tenth (450 million) have no electricity.
There are also increasing pressures to build a sustainable, low-carbon energy future, and even consumers are driving ethical tech solutions and making businesses rethink sustainability. The climate crisis is starting conversations around how quickly we replace devices when a desktop can produce 300kg of carbon dioxide during manufacturing and can take 200,000 liters of water to build a laptop.
As the digital talent gap continues to widen, every nation in the world much also tackle the digital skills divide. Governments need to take the lead in helping marginalized groups learn new digital skillsets. Climate change and the digital divide are great examples highlighting the importance of global collaboration in the digital economy to solve the world's big problems.
We are entering a period where technological change will create unprecedented opportunities for anyone to reskill and enter a career in the tech industry. With many nations struggling to meet demand with thousands of unfilled vacancies around cybersecurity and cloud technology, now is a perfect time to solve the critical tech skills shortage and play a part in the digital economy.
Looking to the future, there are rumors of concerns in Washington that bringing Japan and Australia closer to the Chinese economy will impact the long-term relationship with the US. Whether the RCEP free trade deal will signal a power shift in Asia-Pacific and pace the way for the region to dominate the digital economy is still up for debate. The only thing we know for sure is that the future is digital. So upskilling and reskilling workers to ensure no one is left behind should be on top of every leader's list of priorities.