E-commerce pact aims to lower costs, protect consumers

From Cambodian craftsmen to Indonesian sambal sellers, small and medium-sized entrepreneurs across South-east Asia will be able to tap with greater confidence the region’s burgeoning e-commerce market in search of new customers.

And companies peddling their goods and services online may no longer have to navigate varying regulatory hurdles when selling across the region’s borders.

Possibilities such as these were unlocked yesterday when Asean economic ministers inked the grouping’s first agreement to facilitate e-commerce across the region.

Singapore’s Minister for Trade and Industry Chan Chun Sing said the pact, which went through nine rounds of negotiation, showed “Asean’s commitment to create a conducive environment for the growth of e-commerce through advancing trade rules in e-commerce and building up greater digital connectivity within the region.”

The pact was signed ahead of the Asean Economic Community (AEC) Council meeting yesterday, which brought together economic ministers in the run-up to today’s official opening of the 33rd Asean Summit, when leaders of all 10 Asean nations and their key partners take stock of ties and discuss ways to boost cooperation in a way that will benefit their citizens, help lift the region’s economy and strengthen its security.

Asean is the world’s fastest-growing Internet market, with 330 million users online – but non-tariff barriers such as logistics and cross-border digital regulations have been stumbling blocks for companies looking to capitalise on e-commerce opportunities.

Sustained economic growth and a young, digitally savvy population are key drivers of the region’s for-midable Internet economy, which is set to quadruple to US$200 bil-lion (S$276 billion) by 2025, with e-commerce expected to grow to US$88 billion.

(From left) Laos’ Minister of Industry and Commerce Khemmani Pholsena, Malaysia’s Minister of International Trade and Industry Darell Leiking, Myanmar’s deputy director general of the Ministry of Planning and Finance Nyein Zin Soe, Philippine Secretary of Trade and Industry Ramon M. Lopez, Vietnam’s Vice-Minister of Industry and Trade Tran Quoc Khanh, Singapore’s Minister for Trade and Industry Chan Chun Sing, Thailand’s Deputy Minister of Commerce Chutima Bunyapraphasara, Brunei’s Minister at the Prime Minister’s Office and Minister of Finance and Economy II Amin Abdullah, Cambodia’s Minister of Commerce Pan Sorasak, Indonesia’s Minister of Trade Enggartiasto Lukita and Asean’s Secretary-General Lim Jock Hoi at the signing ceremony of the Asean Agreement on Electronic Commerce yesterday. Asean is the world’s fastest-growing Internet market with 330 million users online, but non-tariff barriers have been stumbling blocks for firms. ST PHOTO: GAVIN FOO

The region’s e-commerce potential has attracted foreign giants like Amazon and Alibaba, and fuelled the rise of home-grown “unicorns” – start-ups valued at over US$1 billion – such as Singapore’s Lazada and Indonesia’s Tokopedia.


This agreement will help bolster the trust and confidence of Asean consumers in e-commerce and drive adoption. In doing so, we will enable Asean businesses to grow domestically, regionally and globally.

MINISTER FOR TRADE AND INDUSTRY CHAN CHUN SING, on the pact to facilitate e-commerce throughout the region.

These online marketplaces offer micro, small and medium-sized enterprises the means to transact online and reach new customers within and beyond Asean, said Mr Chan. Even so, e-commerce adoption in Asean represented just 2 per cent of total retail sales last year, compared with 20 per cent in China and 12 per cent in the US.

The new e-commerce pact aims to change this state of affairs.

Its benefits include:

•Encouraging cooperation on policies in areas such as online consumer protection, legal and regulatory frameworks, electronic payments, intellectual property rights, and cyber security;

•Promoting paperless trading between businesses and government, such as electronic Customs forms, for speedier and more efficient transactions;

•Promoting better consumer and personal data protection, including online dispute resolution mechanisms for e-commerce claims, to help bolster the trust and confidence of consumers;

•Enabling businesses to access and move data across borders more easily, subject to appropriate safeguards.

The agreement will streamline regional trade rules governing e-commerce and improve the operating environment for businesses, Mr Chan told his counterparts at the AEC Council meeting.

Consumers in the region also stand to benefit from lower costs, improvement in the speed and reliability of supply chains, and more robust consumer protection measures, he noted.

Before the pact was signed, Mr Chan said: “This agreement will help bolster the trust and confidence of Asean consumers in e-commerce and drive adoption.

“In doing so, we will enable Asean businesses to grow domestically, regionally and globally.”

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