Digital Government in South-East Asia: Greater Collaboration Needed to Reach Regional Integration

Technology Policy Digital Government

Digital Government in South-East Asia: Greater Collaboration Needed to Reach Regional Integration

Briefing
Posted on: 11th April 2022
By Multiple Authors
PeiChin Tay
Policy Lead (Digital Government Unit)
Hilda Barasa
Africa Policy Lead, Digital Government Unit

    Our new five-part series, which includes an introductory outline, reports on the progress of digital government in major regions worldwide.

    South-East Asia: While a burgeoning digital economy and growing citizen engagement underline the region’s potential, uneven adoption and connectivity remain barriers to comprehensive digital-government transformation.

    • Asia-Pacific is the most diverse and digitally divided region in the world despite being home to some of the world’s fastest-growing economies and more than half the global internet population. While the region includes advanced digital governments, including South Korea, Japan and Singapore, it also has some of the least-connected countries, for example Laos and Myanmar, which grapple with low access and connectivity coupled with high internet costs. To fully realise the potential and benefits of digital-government transformation, closing the digital divide at the local, national and regional levels must be an economic, political and social imperative.
    • As a coordinating body, the Association of Southeast Asian Nations (ASEAN) has played a key role in creating cohesive digital-government frameworks and agreements. However, political differences, contrasts in democratic progress, external pressures and the willingness to conduct reforms constrain digital-government transformation.1 Apriliyanti, I.D.Kusumasari, B.Pramusinto, A. and Setianto, W.A., “Digital divide in ASEAN member states: analyzing the critical factors for successful e-government programs,” Online Information Review (2021) Furthermore, many ASEAN-level agreements are not legally binding and there is a lack of collaboration efforts across leading ASEAN countries, such as Singapore, Malaysia, Thailand, Vietnam, Indonesia and the Philippines.
    • While all South-East Asian (SEA) governments have developed a national strategy for digital government at the central level, greater collaboration and decentralisation to subnational governments and line ministries are needed to realise attainment of digital government goals. This is critical in a citizen-centric approach to public-service delivery as most services are delivered at subnational and local levels.
    • There is growing recognition of the need to engage citizens in the policymaking and service-design process, and for government delivery services to become more citizen-centric.
    • The internet penetration rate of 75 per cent is particularly high in SEA where 40 million new internet users came online in 2021. The SEA digital economy is expanding at a rapid pace, and the growth of tech “unicorn” companies as well as small tech firms is spurring on the region’s governments to achieve faster and more inclusive digitalisation.
    • The E-Government Development Index (EGDI) shows that there was steady improvement in the Asian region between 2016 and 2020. Two SEA countries (Malaysia and Thailand) joined the “very high EGDI” group for the first time in 2020. 

    Figure 1 – Mapping out a fully connected digital-government ecosystem in South-East Asia

    Source: TBI

    The Asia-Pacific Economic Cooperation (APEC) forum has served as a trans-Asian platform for economic dialogue between countries in the Pacific region since 1989, playing an important role in facilitating regional consensus on digital-economy enablers. Other coordinating bodies such as ASEAN have played a central role in setting out digital priorities and cohesive frameworks, including the ASEAN Digital Masterplan 2025, ASEAN ICT Masterplan 2020, and the ASEAN Declaration on Promotion of Good Governance and Acceleration of an Agile Civil Service in a Digital Economy.

    UN agencies have played a positive role in fostering open policymaking and grassroots participation by setting up accelerator labs and partnerships with national governments to form policy and innovation labs (for example, Sri Lanka’s Citra Social Innovation Lab, Indonesia’s Pulse Lab Jakarta and the Thailand Policy Lab).

    Additionally, the private sector is a strong driver of digital-government transformation and many transformation efforts are geared towards government-to-business services, particularly since small and medium-sized enterprises are the main engine of growth, representing up to 99 per cent of all businesses and responsible for more than 90 per cent of employment.

    The Three Principles of Whole-of-Government Transformation

    Purposeful Governance

    In all SEA countries, digital strategies cover public services to citizens and businesses (for example, online applications for permits, licences and certificates). All governments have developed a national digital-government strategy at the central level. Digital-government strategies also apply at the subnational level in six SEA countries (Laos, Malaysia, Myanmar, the Philippines, Thailand and Vietnam), and at the local level in seven (Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Thailand and Vietnam). Most countries have established offices responsible for the horizontal coordination of open-government initiatives that are typically addressed as part of a larger portfolio, such as extensions to policy areas including education, economy, health, recreation, culture and religion, and social protection. Digital technologies are rapidly being absorbed into all government activities and processes, and are becoming more prominent in countries’ national budgets.

    However, cross-service digitalisation is hampered by limited coordination across different levels of government. The Organisation for Economic Co-operation and Development (OECD) estimates that only half of SEA countries have formal mutual coordination processes or mechanisms below the national level. Malaysia, Indonesia, Myanmar and Vietnam are the only countries that presently coordinate across all levels of government. Reflecting its federal system of government, Malaysia additionally coordinates across local levels, including its municipalities.

    Indonesia Accelerates Open-Government Initiatives

    Indonesia’s journey towards open government started in 2008 when the country passed the Public Information Disclosure Act to promote good governance and transparency. Three years later, it initiated the Open Government Partnership in collaboration with seven other countries to encourage governments to take concrete actions on enhanced transparency, accountability and citizen empowerment.

    More recently, the country’s digital-transformation efforts have accelerated, with the 2018 introduction of e-government guidelines and implementation standards prompting greater focus and integration. Many of the improvements to digital-service delivery and implementation of open, e-government were driven by the Open Government Initiative that sets priority agendas for a two-year period. This resulted in a significant increase in the provision of government services delivered online, including to vulnerable groups and regional and rural citizens. Indonesia’s efforts were recognised by the UN when they moved from a “medium” ranking in 2016 to “high” in 2018 on the EGDI.

    Enabling Infrastructure

    Most SEA countries (90 per cent) have established a citizens’ portal online and they are typically more comprehensive than those created in OECD countries. For example, SEA portals often link to services provided by other websites and offer access to other government services from their own platform. Malaysia and Myanmar have the most comprehensive national citizens’ portals that offer access to government services provided by the responsible authority; unique services on behalf of responsible authorities, which involve the portal acting as a delivery “shell”; and online services found through other specific websites of the responsible authority.

    ASEAN member states have reached different levels of progress with their foundational ID systems, which largely reflects their broader economic development. Among SEA countries, half have fully digitalised their foundational ID systems and established the associated public infrastructure needed for widespread adoption of foundational IDs in public- and private-sector transactions.

    Singapore Expands Digital-ID Applications

    Singapore’s national digital ID system, SingPass, has evolved to integrate seamlessly with citizens’ lives. It can be used to access more than 1,700 digital services (both public and private) from the opening of a new bank account to the filing of taxes or applying for public housing online. It has also formed the basis for integration with other key government initiatives, allowing users to manage their personal data online and auto-fill forms upon consent. Other plans in the pipeline include the use of facial verification, extending the scheme to more locally registered businesses for improved user experience, and facilitating transactions outside Singapore, including within ASEAN and the European Union.

    Businesses and non-profit organisations have access to their own corporate digital identity (CorpPass), which facilitates online transactions with government agencies.

    Responsive Institutions

    Despite achieving advances in digital infrastructure and national policies, e-government decision-making remains largely centralised and is taken at high levels of management. However, there have been some initiatives to embrace a more experimental and open culture. For example, Singapore’s Open Government Products, a startup within government, is positioned as “an experimental development team built from the ground up to function like a modern tech company working on public-sector problems”.

    A study on civil-service modernisation in ASEAN countries highlighted the importance of building a future-ready leadership pipeline with relevant digital skills. Many of the ASEAN countries surveyed sought to have leaders who were citizen-centric, techno-savvy, connected, collaborative, culturally intelligent, and creative and innovative. Efforts to modernise and upskill civil servants, particularly during the pandemic, has resulted in several challenges, however, including the lack of availability of digital infrastructure and low digital literacy among citizens, particularly in regional and remote areas.

    Improving Transparency and Decision-Making in the Philippines

    The Philippines’ Anti-Red Tape Act (ARTA) was introduced in 2007 to reduce incidents of corruption, improve transparency in government processes and to speed up service delivery. ARTA introduced a “maximum processing period of five days for simple transactions and ten days for complex transactions” alongside other requirements, such as limiting the number of signatories for different contract types. Each agency’s adherence to ARTA requirements was assessed annually and a report card was issued. It was successful in promoting transparency and accountability through simplified procedures and streamlined transactions in government agencies.

    In 2018, ARTA was extended to include the Ease of Doing Business Act that minimised red tape. Notably, the anti-corruption policy has meant that there is no face-to-face or identifiable contact between the government and business applicants, and all processes are either automated or completely anonymised.

    Barriers

    Barriers
    • Digital divide: The unprecedented pace of digital adoption has meant that some citizens as well as businesses are lagging behind, and are unable to fully participate and take advantage of the burgeoning digital economy or developing digital-government services. Within many SEA countries, there are still considerable digital-access gaps between rural and urban areas, especially in Indonesia, Thailand, Vietnam and Malaysia. Lack of digital infrastructure limits both digital-literacy acquisition and citizens’ access to digital services.
    • Lack of digital interoperability: Regional collaboration within SEA is limited by the lack of interoperable systems and frameworks across border areas and countries. SEA countries have taken varying approaches to data privacy and security concerns, with some governments seeking to restrict cross-border data flows. Vietnam and Indonesia, for example, have the most comprehensive restrictions on data flows in ASEAN. Regional coherence on strategies, policies and systems can boost cross-border public services and e-commerce.
    • Budgetary resources: Several studies have pointed to the general lack of political will as well as a mandate to coordinate and carry out reforms. This is compounded by the lack of financial resources in some countries. For instance, countries with a low gross domestic product, such as Cambodia and Laos, tend to prioritise their budgets for poverty-alleviation programmes. This means maintaining e-government programmes can be challenging because donors typically support the initial stages only. 
    • Accountability: Limited political openness and poor accountability can result in a reluctance among governments to harness information and communications technology to increase the participation of citizens in decision-making. E-government can also be perceived as a potential threat to power because it may reduce government authority. Democratic practice varies across SEA nations and some countries limit the use of technology to increase the participation of citizens in decision-making.
    • Cloud computing: Embracing the benefits of the cloud can enable governments to become more agile, resilient and cost-effective. However, there are barriers to cloud adoption in Asia’s public sector, such as establishing balanced security and data-protection policies as well as cohesive technical and security policies. The few countries that have developed digital-security strategies are yet to develop specific government mechanisms and policies to back these up. Such barriers can affect the reliability of public services and, in turn, citizens’ trust in digital government.

    Opportunities

    • Digital infrastructure: Bridging the digital divide through infrastructure investment is crucial to expanding access and improving affordability, particularly for the underserved regions in SEA.
    • Digital skills and capabilities: All ten ASEAN countries have developed digital-economy masterplans, and most have cited capacity building, skills or education as their priorities. The region already has a good foundation of literacy and numeracy, and education systems will benefit from greater adoption of basic and advanced digital skills, as well as the soft skills needed for both citizens and civil servants alike to thrive in the digital economy and access or deliver digital-government services. Partnerships with private-sector stakeholders in the region should be explored as part of upskilling strategies.
    • Data and cybersecurity laws: Common regional rules and standards for cross-border data sharing and cybersecurity can boost digital interoperability as well as regional integration.
    • Citizen engagement and participation: Digital-government services are less likely to meet the requirements of citizens and be fit-for-purpose without adequate engagement in the design process. There are challenges in building trust with citizens when there have historically been low levels of trust in government, and where there is little awareness of the purpose of engaging with authorities. The United Nations Development Programme (UNDP) collaborates with national governments to bring co-investment and knowledge exchange to more local levels of government. For instance, the UNDP collaborated with the Thai government’s Office of the National Economic and Social Development Council to jointly establish the Thailand Policy Lab and open up policy-design processes to citizens.
    • Regional cooperation and exchange: While SEA is a global economic player, there are significant differences in adoption of digital technology between most- and least-advanced countries. This leads to gaps in quality, access, affordability, infrastructure, skills, competition, inclusion and policy. It is estimated that increased investment in digital integration, backed by a consolidated and coordinated ASEAN approach, could add an additional $0.8 to $1 trillion to the region’s GDP by 2025. This approach would include addressing barriers to accessing affordable internet as well as to engaging in cross-border trade and building digital skills. Greater regional cooperation and exchange through implementation of bilateral and regional ASEAN agreements is key to digital integration.
    • Digitalisation of the consumer experience: This region has taken a lead in social commerce and online shopping models, as seen in the growth of super apps like WeChat on which users can access functions such as messaging, social media, online shopping, ride hailing, food delivery, digital payments and more – all through a single application. About 78 per cent of SEA consumers define themselves as “digitally curious” or “digital explorers” and show a strong appetite for more digital experiences and services. The platform economy is seen as a key driver of SEA’s digital economy. Therefore, there is great potential in extending the digital consumer experience to government, finance and health care.

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