Southeast Asia stands as a burgeoning hub for digital investments, driven by its youthful and tech-savvy population. With 61% of its population under 35, the region offers fertile ground for technological advancements. As the Association of Southeast Asian Nations (ASEAN) strives to double the projected value of the region's digital economy by the decade's end, initiatives like the Digital Economy Framework Agreement (DEFA) are being negotiated to foster cooperation among member states.
Despite its promising potential, Southeast Asia faces significant challenges. The region remains 55-70% underpenetrated in terms of data center supply when compared to developed markets like China, South Korea, and Japan. This gap presents both an opportunity and a challenge, as governments work to attract digital investments through incentives such as corporate tax reductions and financial perks. Thailand, for example, offers tax reductions and promotes its fast internet infrastructure, while Vietnam provides financial incentives in research and development, along with land rental exemptions and preferential credit.
However, access to renewable energy remains inconsistent across the region, presenting a hurdle for sustainable growth. Generative AI systems exacerbate this issue, consuming up to 33 times more energy than traditional processes. Recent reports show that companies like Microsoft and Google have seen significant increases in carbon emissions due to their investments in global data centers.
"Regulatory systems are the most critical priority for the governments to address first before talking about initiatives or incentives. And definitely, they should have the tech firms in their mind when designing policies or regulations," – Khuong
To address these challenges, ASEAN has launched its Guide to AI Governance and Ethics, a non-binding set of guidelines emphasizing transparency, fairness, security, reliability, human-centricity, privacy, and accountability. Various countries in the region are also developing laws or frameworks focusing on AI and data use, such as Singapore's Model AI Governance Framework and Vietnam's digital technology industry law.
"Big Tech is definitely more powerful now than many governments, having engineered a lot of this pervasive dependency on their technologies to the point that it's from the time we wake up to the moment we sleep. They're always there," – Linis-Dinco
As AI becomes increasingly integrated into daily life, experts stress the need for robust regulation.
"The new challenge for humanity is how to regulate AI, how to adopt AI. So it is something even bigger than the disruption of the internet, arguably," – Kanggrawan
"AI is too important not to regulate and to not regulate well. Our approach has to be bold and responsible and we want to hold ourselves to that accountability," – Chadha
"We also believe that AI regulation will need to be based on a global policy alignment and mutual recognition of safety frameworks, similar to other domains such as aviation," – Della Mattea
The rise of AI presents a double-edged sword; while it offers unprecedented opportunities for growth and innovation, it also poses risks of over-dependency and skill erosion.
"There is always a serious risk of becoming overly dependent on this kind of technology because this over-reliance will lead to a lack of essential skills," – Jean Linis-Dinco
"Human oversight is not only crucial, but is fundamental in making sure the proliferation or the use of such technology is not just responsible, but also human rights-backed," – Jean Linis-Dinco
Energy consumption by data centers also presents an environmental challenge.
"Data centres and data transmission networks are estimated to each account for 1 to 1.5 per cent of the global energy consumption," – Tan
"Widespread adoption of AI will push this consumption much higher, as evidenced by the recent disclosures by several of the largest tech companies," – Tan
"The result could be “emboldening business, investor and citizen confidence in the region’s economic prowess,” – Johnson
As policymakers navigate these complex issues, experts urge them to deepen their understanding before enacting regulations.
"You are the policy makers, legislative, national, provincial level, better you catch up your knowledge before you make the regulations. Don't only rely on second-hand sources, tech companies, vendors, lobbyists or whatever," – Kanggrawan
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